Crisis Looming in the Private Rental Sector

The COVID-19 pandemic has disrupted the economy and caused havoc to so many people, and the private rental sector is no exception.

Many of the people living in rental housing are on low incomes. The loss of jobs and mass closures in retail, hospitality, and the service sector has caused many tenants to lose their source of income. There is government help available, but a great number of people have fallen through the net or are unable to claim enough money to cover their outgoings.

Ban on Evictions

The government has placed a moratorium on evictions, but whilst many landlords are sympathetic to the plight of their beleaguered tenants, not all are.

The three-month eviction ban is due to expire at the end of June. Once the stay of execution is lifted, it’s likely that some landlords will immediately launch eviction proceedings to remove non-paying tenants from their properties. This could cause a homelessness crisis.

Desperate Tenants Seek Help

Housing charity, Shelter, says it has seen a surge in demand for its help since the coronavirus pandemic hit.

“At the moment, there are so many people from different groups who would never have thought they would be relying on universal credit…it is proving hard for people to find and move somewhere cheaper,” Chris Wood from Shelter told the Financial Times.

Experts say the government should extend the ban on evictions for another three months, as they have extended the three-month mortgage holiday for homeowners. This will help to avoid illegal evictions.

Government Proposes Payment Plan for Cash-Strapped Tenants

Housing Secretary, Robert Jenrick, has put forward a proposal whereby landlords are duty-bound to agree on a payment plan for tenants behind on their rent before they try to evict them. This proposal is supported by the National Residential Landlords Association (NRLA), as it should ease the eviction crisis and free up the courts – at least temporarily. However, critics claim the proposal wouldn’t protect tenants in any meaningful way and if landlords refuse to negotiate, judges will most likely still allow them to regain possession of their property.

Furthermore, landlords are still free to serve a Section 21 notice once the moratorium ends, as the government has not yet put a stop to no-fault evictions, despite consulting on a plan to end them.

Labour Wants to Ban Evictions for Six Months

Labour is calling for a six-month ban on evictions, followed by a two-year debt resolution process to allow tenants to pay off their rent arrears. However, this would cause huge problems for smaller landlords, as many can’t afford to lose their rental income for an extended period.

What happens next remains to be seen, but it’s likely that there will be no winners in any solutions that are put forward.

Read More Like This:

Pass Mortgage Savings on to Tenants Says Letting Agent

Activists Call for a Rent Strike in the UK

COVID-19 Will You Survive the Aftershocks? Part 1