Landlords share how they are helping tenants as Coronavirus cases climb

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The number of confirmed coronavirus cases in the UK is on the rise, and more people are either working from home or self-isolating due to recent government advice on Covid-19. The RLA is calling for a package of measures for landlords to be able to support tenants affected by coronavirus. This includes a temporary scrapping […]

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Leading Labour MP calls for emergency legislation to stop Coronavirus-linked evictions

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Labour MP Tulip Siddiq is urging the Government to immediately outlaw all no-fault evictions so that tenants don’t lose their home as a result of the disease.

Writing in The House,
the MP for Hampstead and Kilburn says low
income private renters are already living precariously and need the option to
defer rent payments.

Siddiq believes the impact of coronavirus could be
devastating for many working families, 60% of whom are just one paycheque away
from losing their home.

“Statutory Sick Pay of £94.25 won’t come close to
covering the cost of rent for most tenants in London. A shocking 63% of private
renters have no savings at all, so the loss of a job or income as a result of
the virus could mean many thousands are unable to pay rent.”

Renters will not be able to self-isolate if they don’t
have security in their homes, she adds.

“The ending of private sector tenancies has become the
main single cause of homelessness – the Government must ensure that people
aren’t being forced onto the streets as a result of coronavirus.”

She writes: “It may seem tragic that it takes an epidemic
like coronavirus to fix these inequalities but if there are opportunities in
this situation to improve the plight of the low income private rented sector,
we should seize them and act now.

“We must scrap Section 21 and outlaw all ‘no-fault
evictions’ urgently. We must also look at other ways of improving the private
rented sector, including better standards, properly funded enforcement, longer
tenancies, a register of private landlords and rent controls.”

The Labour Party has just published a proposed draft Bill to ban evictions of tenants who fall behind on rent due to coronavirus. It wants the Government to adopt emergency legislation to protect families.

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Will the Coronavirus have a major impact on the commercial property market?

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Commercial Property:

The Coronavirus
contagion technically known as COVID-19 originated in Wuhan, Hubei
province, China but is now spreading at a rapid pace across the
world. It is causing major disruption for businesses, tenants and
landlords. Initially affecting travel companies and hotels, its
effects will be much more far reaching before we’ve done, and as we
are in uncharted territory the end result is as yet unknown.

With stock market
valuations down by an average of thirty per cent currently, and
heading for the 50 per cent drop of a typically serious bear market,
commercial property funds and property values will inevitably be
seriously affected. Depending on how long the crisis lasts, many
businesses will find themselves struggling to pay rent and service
their debts, meaning they could breach the terms of their leases and
face themselves and their landlords with some difficult decisions.

Sales and purchases
are more than likely to be put on hold as vendors and property
purchasers adopt a “wait and see” approach. Most commercial
landlords see their investments as long-term and will generally hold
on and see a crisis through, but the longer the crisis continues,
highly geared commercial landlords will find in more difficult to
service existing debt and raise capital, the giant
shopping centre owner Intu being a case in point.

Many sectors of the
economy are at risk, so landlords need to closely monitor the
financial health of their tenant companies. Retail has been in
decline for some time, so in some cases Covid-19 could be the last
straw. Travel and tourism is badly affected, but now restaurants and
pubs are coming into the firing line, and the construction and
manufacturing sectors may next suffer as materials and component
supplies from our interconnected world dry-up.

In the meantime it
will be important for landlords to monitor the financial health of
existing tenants. Landlords may start to see an increase in rent and
service charge arrears and eventually in voids as tenants default on
leases and put off renewing leases or fail to take-up additional
space.

Conversely, some
sectors like grocery supermarkets and home deliver businesses like
Amazon could be busier than ever, running flat out to keep the
shelves stocked and the deliveries made.

Travel restrictions
and component shortages could lead to labour shortages and delays in
new project starts, leading some tenant companies to rely on force
majeure clauses in their
contracts, to relieve them of their performance obligations.

Most commercial
tenants will be tied-in to long-term leases which, depending where
they are in the lease term, will not allow early termination; their
they lease contracts will rarely have force majeure
concessions.

Landlords will be
reluctant to allow tenants in trouble “off the hook” as they will
then pick up business rates and insuring obligations themselves.
Encouraging tenants to assign their leases or sublet the whole or a
part of their premises may be an optimal solution for some landlords.

In unusual
circumstances it may be possible for a tenant to argue that the
contract is frustrated by operation of the law. The common law
doctrine of frustration means that if a judgement can be
successfully obtained from a court, the contract is deemed nil and
void, and the tenant would be discharged from all its obligations
under the contract (lease agreement). It has to be said that a
frustration judgement would be exceptional in the case of a
commercial lease agreement.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Will the Coronavirus have a major impact on the commercial property market? | LandlordZONE.

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We are prepared

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The team of advisers and staff at H D Consultants, long standing mortgage and insurance advisers to the Property118 community, already has a robust business continuity plan and contingency strategy in place, enabling us to be on hand for advice

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Today in politics: Coronavirus, research and electrical safety

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Today we examine Labour calls for a ban on eviction of tenants falling behind on their rental payments due to Coronavirus. We also look at new data claiming more landlords plan to sell up and examine a Lords debate on electrical safety standards. Labour calls for eviction ban The Labour Party has published a proposed […]

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Removal of restriction from leasehold property?

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I am currently trying to get a secure loan against my property. Everything is fine from the loan side my issue is that the property is leasehold and Redrow who sold on my leasehold still have a restriction on my title deed.

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Covid-19 will crash my student BTL business?

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The majority of my BTL portfolio is offered to students. Following the recent switch to online teaching and exams by some universities, I assume that most will soon be instructed to close until after the virus peak, estimated at three to four months.

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BLOG: RLA Wales attends Welsh Conservative conference

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On the first weekend of March, RLA Wales visited the Welsh Conservative Party conference in Llangollen, Denbighshire ahead of next Spring’s Welsh Parliament election. This was meant to be the first of three conferences for the RLA in Wales this month, but the Plaid Cymru and Welsh Labour conferences – meant to be held in […]

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Spouse Property transfers and SDLT?

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I am led to believe spouse property transfers are Capital Gains exempt. I also understand if the property transfer is NIL, there is no SDLT payable.

However, if the property is mortgaged, SDLT is payable on the amount of mortgage transferred.

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Landlord and his relative fined £40,000 over unlicensed properties in Newport

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Jamshed Rana and Omar Rana must now each pay £20,000 plus costs after being found guilty of operating dangerous and unlicensed HMOs.

A landlord and manager of an HMO in Newport have been fined a total of £40,000 by city magistrates for risking their tenants’ lives.

Jamshed Rana, owner and landlord of two properties in Augustus Place (pictured), was found guilty in his absence of operating two unlicensed HMOs and several breaches of safety regulations.

The charges included serious
breaches of fire safety regulations, rooms too small for habitation and exposed
wiring to a hot water heater.

He was fined £20,000 and ordered
to pay costs of £460 plus a victim surcharge of £170.

Relative Omar Rana, of Kimberley
Close, Luton, the manager of the two properties, was found guilty in his
absence. He was also fined £20,000 and ordered to pay costs of £460 plus a victim
surcharge of £170.

Councillor Ray Truman, Newport
City Council’s cabinet member for licensing and regulation, says: “Operating
properties without the necessary fire precautions leaves tenants at serious
risk of death.

“Regulations in relation to HMOs
are there to protect and safeguard tenants so we take seriously any breaches of
the rules. Landlords and property owners have to meet their obligations under
the law, or we will not hesitate to take robust action.”

It follows another successful prosecution by Newport City Council earlier this year when a property management company and its director were fined more than £14,000.

Read more about the private rental market in Wales.

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