Want to return to live in your rented-out property?

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Re-possession:

During the present
health crisis, with everyone on virtual lock-down, new lettings are
on hold, but when normality resumes, as it surely will, people will
want to let out their own homes on a temporary basis.

Whether for extended
travel or working away, there is a little known way of letting which
ensures landlords can reclaim possession of their properties safely
at the end of the term – known as ground 1. It applies where the
letting has been your main residence and you are returning to occupy
it yourself, or where it was not your main residence before but that
you intent to live there now.

There has been much
talk of a change in the law which would mean that the existing
shorthold regime would be replaced by something equating to an open
ended tenancy, but don’t worry, this won’t happen for at least a
couple of years and given the current crisis, perhaps even longer.

This article is
based on English law and is not a definitive statement or
interpretation of the law; rules change and every case is different –
only a court can decide. Other jurisdictions are similar but there
are important differences. Always seek expert advice before making or
not making decisions.

Ground 1 comes under section 8 of the Housing Act 1988 and appears in schedule 2

In order to apply this clause two things need to happen: (1) your tenancy agreement should include a clause referring to ground 1 and that this may be involved, and (2) the tenant, prior to the start of the tenancy, must be served a notice explaining ground 1 and stating that the letting is on the basis that ground one may be invoked. Of course you need to keep a copy and get proof that the tenant received it, ideally a signature.

Ground 1 (Section 8,
Schedule 2, Housing Act 1988) states:

Not later than
the beginning of the tenancy the landlord gave notice in writing to
the tenant that possession might be recovered on this ground or the
court is of the opinion that it is just and equitable to dispense
with the requirement of notice and (in either case):

(a) at some time
before the beginning of the tenancy, the landlord who is seeking
possession or, in the case of joint landlords seeking possession, at
least one of them occupied the dwelling-house as his only or
principal home; or

(b) the landlord
who is seeking possession or, in the case of joint landlords seeking
possession, at least one of them requires the dwelling-house as (his,
his spouse’s or his civil partner’s) only or principal home and
neither the landlord (or, in the case of joint landlords, any one of
them) nor any other person who, as landlord, derived title under the
landlord who gave the notice mentioned above acquired the reversion
on the tenancy for money or money’s worth.

Notice requiring
possession:

Ground 1 is a
mandatory ground, which means that providing the conditions have been
met in full the court must issue a possession order – it requires
the same notice period as a s21 notice – minimum of 2 months.

Ground 1 no Prior
Notification Notice

In this matter the
courts have some discretion, so in exceptional circumstances, where a
landlord lived in the property prior to the tenancy, and they can
show exceptional hardship on the landlord’s part, and better
circumstances for the tenant, the courts have been known to issue a
possession order without the Ground 1 Prior Notification.

Involking Ground
1

If Ground 1 needs to
be invoked, the landlord serves a section 8, ground 1 notice on the
tenant which gives the tenants a 2-month notice period. However, this
notice cannot expire within a fixed-term period. Housing Act 1988
s7(6)(a)

Given the long
notice period and court schedule waiting times, it is likely to be at
least 3 months before the tenant can be removed, even in a best case
scenario so returning landlords should plan for this.

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – Want to return to live in your rented-out property? | LandlordZONE.

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Lenders to give 3 month offer extension for home movers

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To help home movers impacted by Covid-19, mortgage providers will give customers who have exchanged contracts the option to extend their mortgage offer for up to three months to enable them to move at a later date.

Stephen Jones

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INVESTIGATION: Councils all over the UK stop or scale-down new and existing property licensing schemes

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Local authorities are de-prioritising the enforcement or introduction of select and HMO select licensing schemes as they focus their stretch resources on battling Coronavirus.

Selective licensing has been put on the back burner by many councils as they reorder priorities to deal with the Coronavirus pandemic.

Although the Local Government Association hasn’t issued
any guidance, councils around the country are making changes to inspections and
consultations.

The latest to announce a pause is Newcastle, which earlier this week confirmed it would be introducing its licensing schemes but has since changed its mind.

The city’s selective and
additional licensing schemes, which were due to start on 6^th April,
have been suspended by three months to 6^th July.

Luton’s scheme, which was scheduled for 1^st May has now been deferred, while Camden in London has suspended inspections.

Camden council’s website says: “We will instead issue licences based on the information provided with the application. If needed, we will contact you for further information by phone or email. We may also contact your tenants.”

Scaled down

In Great Yarmouth, although the council has vowed to continue with its HMO scheme, it’s scaled down activities too.

In a statement, a council spokesman says:
“We temporarily suspended proactive inspections of privately rented dwellings,
including selectively licensed and mandatory HMO licensed dwellings.”

This
means that despite routine inspections being called off, tenants can still
complain to the council if they consider their living situation unsafe in any
way.

The
Great Yarmouth spokesperson adds: “Whilst such routine inspections had
continued to be carried out on a risk-basis in accordance with Government
guidance, they have now been suspended in light of the tighter national
restrictions now in, and the requirement for environmental services officers to
focus work on the response to Covid-19.”

Sandwell Council in the Midlands, which had been consulting on its scheme until 5^th April, has called a halt to events early, although people can submit feedback online.

Gavin Dick, local authority policy officer at the National Landlords Association, says it is a mixed bag at the moment.

“Some councils are still consulting, such as Greenwich, some
like Durham have extended the period, while others such as Newcastle are still
trying to force landlords to go out to properties,” he tells LandlordZONE. 

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – INVESTIGATION: Councils all over the UK stop or scale-down new and existing property licensing schemes | LandlordZONE.

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Latest HMRC guidance on Covid-19 support for Self-employed

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The Chancellor, announced a new Self-employment Income Support Scheme to support self-employed people who have been adversely affected by COVID-19.

GOV‌.UK has further details about who is eligible for the scheme and how it will work.

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BREAKING: Courts system suspends all eviction proceedings for 90 days

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Senior court official the Master of the Rolls say both ongoing and new eviction action will be stopped for 90 days, but this may be extended if the Coronavirus crisis lasts for longer.

All housing possession actions in the courts are to be suspended, it has been announced, including cases currently under way or about to go into the system, for the next 90 days

Revealed by the Master of the Rolls, who is the deputy to the Lord Chancellor, the announcement means no eviction proceedings can progress to the stage where someone could be evicted.

This is designed to bolster the government’s efforts to give hard-up tenants security of tenure during the Coronavirus crisis and follows the implementation yesterday of the government’s proposals to extend the eviction action ‘wait time’ to three months.

“Tenants are still liable for their rent and should pay this as usual,” the Ministry of Housing, Communication and Local Government says.

“If they face financial hardship and struggle to pay this, support is available. In the first instance they should speak to their landlord if they think they will have difficulty meeting a rental payment, and in this unique context we would encourage tenants and landlords to work together to put in place a rent payment scheme.”

But the government is also moving to formalise these tenants/landlord discussions by strengthening the requirement for social landlords to work with their tenants prior to action starting – known as ‘pre-action protocols’ – and extending it to the private rental sector

“This will help landlords and tenants to agree reasonable repayment plans where rent arrears may have arisen,” the MHCLG says.

Desperate times

Paul Shamplina of Landlord Action says: “This announcement comes as no surprise, last week we reported we had our first case at Blackpool county court citing the Corona Virus in the court order adjourning the case.

“Through these desperate times landlords will have to accept they will not be able to gain possession of their property until most probably the end of the year.

“Even before this announcement we were saying this to our clients at Landlord Action. The way forward for landlords is mediation with their tenants, payment plans or to negotiate vacate possession.

“But the reality is if you already have a case currently at court, all relationships may have already broken down with the tenant. We are currently putting a service together for landlords for mediation on a website on the next few days.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: Courts system suspends all eviction proceedings for 90 days | LandlordZONE.

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Coronavirus – Government advice on home moving

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This guidance applies to people buying or selling private residential homes which they intend to live in.

Buying and Selling Homes during this stay-at-home period

Given the situation in the UK with regard to the outbreak of coronavirus (COVID-19)

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BREAKING: Direct Line confirms doors closed to all new rent guarantee policy claims

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One of the UK’s largest insurance companies says there is no legal framework available to it that would enable the insurance giant to pay claims now that evictions have been suspended for three months by the government.

One of the UK’s largest insurance companies, Direct Line, has confirmed to LandlordZONE that it has closed its doors to new rent guarantee policy claims, but will honour those which are already under way.

The shock news confirms our story earlier this week that key insurance companies in the UK were withdrawing, or had already withdrawn, from the rent guarantee market.

Direct Line’s announcement will not be welcome news for its thousands of rent guarantee landlord clients, not least because until relatively recently it ran TV adverts promoting the product starring Hollywood actor Harvey Keitel (pictured).

“We are currently in unprecedented times as the impact of COVID-19 spreads through all aspects of the UK economy,” a statement from spokesperson Unni Henry from the parent company The Direct Line Group, says.

“The Government’s commitment is that no tenant will be evicted during a three month period and that landlords are able to apply for a three month payment holiday on their Buy to Let mortgages if necessary.

“During this three-month period we cannot pay any new rent guarantee claims as there is no legal mechanism to allow us to take a claim forward.

“Following the end of this period landlords and their tenants will then need to work together to establish affordable repayment.”

Henry says Direct Line is offering landlords practical support so they can help their tenants during the crisis including digital templates for payment plans.

Also, its legal advice helpline will
continue to be available throughout this period. Landlords should refer to
their policy documents for contact details.

“If the landlord’s rent guarantee claim has already been accepted and they are in receipt of rent guarantee payments, these will continue to be paid during the pandemic,” says Henry.

“For discussion on individual claims, landlords will need to contact the claims team via the number in their policy documents.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – BREAKING: Direct Line confirms doors closed to all new rent guarantee policy claims | LandlordZONE.

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Students – What are my rights and obligations if they leave?

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I have a student HMO. The tenants are still on a fxed term joint and several AST for 10 months commencing 9th Sept 2019. One of the tenants who is Polish has asked to be able to terminate his tenancy early in April subject to travel availability to return to Poland.

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LATEST: Lender exodus from buy-to-let mortgage market in full swing Teaser

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Research by a leading mortgage brokers reveals both small, medium and large lenders suspending or severely reducing their buy-to-let mortgage ranges.

Lenders are pulling the plug on mortgage applications and reducing
their buy-to-let product ranges, leaving landlords struggling to find deals.

Online buy-to-let mortgage broker Property Master warns that the buy-to-let
mortgage market is going into reverse as the impact of the Coronavirus begins
to bite, with some lenders even quitting
the market for the foreseeable future. 

“Landlords are finding that their borrowing options are being
drastically reduced as lenders respond to this new record low base rate
environment and fears of falling house prices by withdrawing entire product
ranges,” says chief executive Angus Stewart.

Products withdrawn

“We have had clients mid-way through a mortgage application only
to find the process is halted and the product withdrawn before they can reach
completion and the release of funds.”

It reports that Saffron Building Society, which offered a range of
mortgages including for portfolio and limited company landlords, now has no
products available, while The Melton Mowbray Building Society and Vida
have followed suit.  

Together Money has suspended lending in both the buy-to-let and
residential market, and Barclays has withdrawn all its products for portfolio
landlords. 

The Mortgage Works and HSBC have both withdrawn their tracker
mortgages for the foreseeable future, while other lenders are tightening
criteria; Kensington Mortgages, for example, has
reduced maximum loan to value lending criteria down from 85% to 75%. Some
lenders have increased rates despite the 0.65% fall in base rate.  

Stewart adds: “We would urge lenders to continue to support
landlord customers, especially those who were moving successfully through the
mortgage application process and would otherwise have expected to be shortly in
receipt of a loan.  

Similarly, we would urge banks to stand by the
commitment made by the Government to provide payment holidays to landlord
customers.”

©1999 – Present | Parkmatic Publications Ltd. All rights reserved | LandlordZONE® – LATEST: Lender exodus from buy-to-let mortgage market in full swing Teaser | LandlordZONE.

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My number one piece of advice is ALWAYS communication

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From today, the Coronavirus Act extends the notice period required for possession using Section 8 and Form 6a (Section 21) from two months to three months.

I have worked with landlords for 27 years, been through two recessions and seen the crippling effect that falling into rent arrears can have both on landlords and tenants.

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