Just like everybody else in society, landlords are concerned, worried, and in many cases frustrated by the public health crisis we are currently facing. It therefore came as no surprise that so many members of the both the NLA and RLA have contacted their respective organisation in search of information, guidance, and reassurance over the last few days.
Across the two bodies we have spoken with thousands of concerned members looking for answers about what they should do if their tenants are unable to pay the rent and what the organisations are doing to jointly find solutions for private landlords.
I am sure that everybody will understand that with medical and government advice changing so rapidly it has been a struggle to disseminate the information landlords need, which is why I wanted to write to NLA and RLA members personally to explain what we are doing on your behalf.
Since the severity of the epidemic became clear, colleagues and I have been speaking daily with officials at the Ministry of Housing, Communities, and Local Government (MHCLG) as well as those constructing the Government’s response in Treasury, the Department for Work and Pensions (DWP), and 10 Downing Street.
Although landlords have, very obviously, not been the Government’s highest priority at every stage of their decision making process, I want to make clear that we are working constructively with policy makers to minimise the adverse impact that the social distancing policies have on the private rented sector.
Of course I understand that there is dissatisfaction with the emergency measures the Government has announced thus far. No landlord wants to be told that they cannot end a failing tenancy, or that they should consider accepting the non-payment of rent, but these are unprecedented times. Rest assured our efforts will remain focussed on ensuring that these extraordinary measures are kept in place for no longer than is absolutely necessary.
Beyond what you have read about in the press and heard in the Prime Minister’s daily press conferences, a great many potential policy options have been discussed, and I am relieved to say that we have managed to ward-off the worst, potentially damaging suggestions put forward so far.
We have focussed on trying to find solutions that do not require private landlords to underwrite their tenants, or absorb costs for which the Government has (as yet) failed to take responsibility, whilst recognising that we all have a part to play in getting through this troubling time.
We have called on the Government to:
- Support tenants to meet their housing costs if they are unable to work. We have argued, correctly in my opinion, that preventing significant arrears from building up is a far more effective solution than simply preventing the termination of tenancies.
- Ensure that any support tenants are given properly reflects their housing costs. Whether in the form of Universal Credit or guaranteed minimum income, household support must account for the cost of housing. The benefit system must be reconnected with market rents.
- Scrap the 5 week wait for Universal Credit. Tenants who are unable to work have bills to pay now, they should not have to wait 5 weeks. We have also called for the housing component of these claims to be paid directly to landlords to safeguard incomes.
- Extend the mortgage payment window to BTL finance. We also picked up this issue with colleagues at UK Finance, the finance industry trade body to push for clarity and guidance and I believe real progress has been made.
- Pause new licensing schemes. Landlords should not be charged fees when they may not be receiving rent and at a time when inspections cannot be carried out.
- Halt the removal of finance cost relief. Pausing the final stage of implementation of s24 could potentially save some landlords thousands of pounds and provide much needed breathing space.
- Waive Council Tax payments for HMO landlords. Occupants of shared housing are most likely to suffer disruption to income and therefore struggle to pay. Landlords need help reducing their costs if their tenants cannot pay.
- Extend grants and low interest loans available to other business to landlords. Whatever happens now cashflow will be impacted for many meaning they may need temporary financial support.
- Stop enforcement against landlords unable to access properties due to isolation measures. Landlords are already struggling to access properties to carry out maintenance, complete gas safety checks, or even just for regular inspections. Flexibility will be essential until the end of this crisis.
The Chancellor of the Exchequer has announced today (Friday 20th March) a comprehensive package of support, which addresses some of these points. Universal Credit is to be reconnected with the 30th percentile of market rents and salaries are to be underwritten, as well as additional measures for the self-employed and businesses.
This is a definite step in the right direction, but we will continue to press for a fully comprehensive package of measures to support landlords and protect their businesses.
To keep members informed we are updating both rla.org.uk and landlords.org.uk daily, and new guidance and supportive material is being uploaded regularly. We will be hosting a series of online events over coming weeks to answer your questions.
In the meantime please bear with us, continue to call our advice services if you need practical support and above all keep safe during this challenging time.