On 18 March 2020, Boris Johnson announced that the government would put forward emergency legislation to protect private (and social) renters from eviction.
The aim was to alleviate some of the financial hardship that much of the country will be facing due to the coronavirus and its knock-on effect of the economy. The government promised to ensure that tenants would not be faced with eviction or homelessness if they are unable to pay their rent due to the coronavirus, and that no landlord would face unmanageable debts.
Coronavirus Act 2020
The promised legislation came in the form of the Coronavirus Act 2020 which was passed in to law on Wednesday 25 March 2020. It has been criticised by the shadow housing secretary, John Healey for failing to go far enough, and simply giving tenants “extra time to pack their bags”. There is also a worrying lack of provision for the rent arrears.
Here are the key changes that the Act will put into place:
– Landlords must give three months’ notice (not the usual two) before they can apply to the court for possession (whether using the Section 8 or Section 21 procedure afforded by the Housing Act 1988);
– The change only applies to notices served on or after 26 March 2020;
– From 27 March 2020, the court service has suspended possession matters (including possession of tenancies in the Rent Act 1977, the Housing Act 1985, the Housing Act 1996 and the Housing Act 1988), which means no case currently in the process or about to go into the process can progress to the eviction stage for the next 90 days – although both the end point and the three month notice period may be extended further;
The new legislation is in force from 26 March 2020 until 30 September 2020.
Important points to note:
– Tenants should continue paying their rent where they are able to. In contemplation of financial hardship, the government has also announced a £500 million fund to assist both employed and self-employed workers together with employers;
– Landlords and tenants are encouraged to work together to deal with rent arrears, including the use of payment plans;
– Landlords remain legally obligated to ensure properties meet the required standards;
– Lenders must offer a 3-month mortgage payment holiday to those affected by the coronavirus, including for buy to let mortgages.
Further guidance has been published by the government and can be found here
The new legislation leaves some uncertainty for both landlords and tenants. Parties are encouraged to maintain an open channel of discussion, and we can assist you with mediation on any of the issues highlighted in this article.
If you wish to have a confidential discussion with our landlord and tenant specialist, we are happy to assist you during these challenging and unprecedented times. Please call Selica Khan on 01922 728110.