In a joint
statement following the reintroduction of a national lockdown, the National
Residential Landlords Association, The Big Issue and Ride Out Recession
Alliance, Shelter, ARLA Propertymark, the Nationwide Building Society, and
StepChange the Debt Charity have said:
“Many
thousands of private renters and landlords across the country now face rent
arrears due to the impact of the pandemic.
“Ministers
have failed to address the core problem of debts which have built despite the
financial package put in place so far. Indeed, the Chancellor confirmed that
housing benefit will not be linked to the cost of renting for future
years.
“Renters,
landlords and letting agents cannot be expected simply to muddle through
indefinitely where they face these financial difficulties. The Government needs
to develop an urgent package to help renters in paying off arrears built since
March last year.
“Without
further action, debts will continue to mount, making it far more difficult to
sustain tenancies and keep renters in their homes after the pandemic.”
The NRLA
recently published new
research relating to this issue. A survey of tenants, carried out by Dynata
for the NRLA, suggests that more than 800,000 private renters in England
and Wales have built rent arrears since lockdown measures began.
Whilst the
average arrears were between £251 and £500, the survey finds that of those
in arrears, 18% now have rent debts of more than £1,000. This would equate to
over 150,000 renters.
For
residential tenancies, the government lifted the stay on all forms of
possession proceedings on 21 September 2020, subject to restrictions, but there
is currently a ban on enforcing possession orders until 11 January 2021.
That ban is
subject to exceptions including trespassers, nuisance or where there are
substantial arrears of rent, as defined in the legislation.
The Prime
Minister has said
the ban is “under review” after Labour leader Sir Keir Starmer called for it to
be extended, but at the time of writing nothing has been announced.
It’s likely
the ban will be extended, so why is this being left to the last minute? [UPDATE 08/01/21 - the ban has now been extended until 21 February 2021, but with some important changes]
Nevertheless,
as Ben
Beadle of the NRLA says:
“Ministers
need to accept that simply banning repossessions does nothing to keep
tenants in their homes long term. In fact, it will achieve the complete
opposite - kicking the can down the road just means larger debts
piling up, creating a bigger problem for tenants and also for
landlords.
To sustain tenancies the
Government needs to provide an urgent financial package to get rent debts
built due to the pandemic paid off.”
The NRLA is
calling for a financial package that includes a mixture of government
guaranteed, interest free, hardship loans and a boost to benefits for those
relying on them, rather than cutting this support as announced in the Spending
Review.