Since the start of lockdown in March, 43pc of landlords have been contacted by their tenants to say they will struggle to pay rent and a mere 49pc of landlords have received full rent payments.
Of the remaining 51pc, 27pc have received 75pc or more of rent, 9pc have received 50pc or less and 15pc have received nothing, according to research by specialist insurer Hamilton Fraser. Of those landlords who have been contacted by their tenants with regard to rent payments, 75pc have agreed a payment plan, such as a payment holiday or rent reduction.
Consequently, it is becoming increasingly clear that landlord confidence is diminishing, six months on from the start of the pandemic and with no end in sight. Many landlords are finding they are unable to continue supporting their tenants ad infinitum and 23pc are considering selling property before the stamp duty holiday comes to an end on 31 March 2021.
Paul Shamplina, brand ambassador for Hamilton Fraser, commented that it is not surprising that more than 50pc of tenants have been unable to pay all or any of their rent, considering the gravity of the times and rising unemployment.
Nevertheless, he added, it is evident that the overwhelming majority of landlords have done everything possible to offer support and maintain tenancies. But the question remains, for how much longer?
Many landlords find themselves in financial difficulties, due to reduced hours or loss of employment, and simply cannot afford to subsidise indefinitely the rents on which they rely.
What is truly concerning, Mr Shamplina concluded, is that the true picture of rent arrears and the impact of the last six months will not become apparent until the end of the furlough scheme at the end of October.
New extended periods of notice for landlords in England
The current stay on residential possession proceedings is due to expire on 20 September 2020. New extended minimum periods of notice for those requiring possession of residential property let on an assured shorthold tenancy (AST) will come into force. These are intended to further protect residential tenants from eviction.
Landlords seeking to recover possession of their property between 29 August 2020 and 31 March 2021 should bear in mind the following changes to the notice periods.
Fault-based notice periods
The Coronavirus Act 2020 (Residential Tenancies: Protection from Eviction) (Amendment) (England) Regulations 2020 came into force on 29 August 2020 and will remain so until 31 March 2021.
During this period, any fault-based notice served in accordance with Schedule 8 of the Housing Act 1988, which seeks to recover possession of a residential property let on an AST for reasons as set out in Schedule 2 (of the Housing Act 1988), must now in most cases give six months’ notice in order to be valid.
The regulations, however, include exceptions whereby the following shorter notice periods will apply before possession proceedings can be issued at court.
No-fault notice period
The regulations also extend the notice period for no-fault notice from three to six months, according to Section 21 of the Housing Act 1988, where the notice requires possession of a property on the expiry of the fixed term granted by an AST.
The limitation period for bringing possession proceedings according to Section 21 is extended to 10 months from the date the notice was given.
The regulations are temporary, with the pre-Covid notice periods due to apply from 1 April 2021. However, with the continual lobbying of the Government to afford more protection for residential tenants, it would not be surprising to see similar measures brought in on a long-term basis.