Much of the country has been shut down in an attempt to quell the Coronavirus onslaught. Only ‘essential’ occupations, businesses and services are functioning. And landlords are not included on the list.This means many, if not most, landlords will face a drop in rental receipts, with no effective remedy to hand. New rentals will be on hold – or at the least extremely difficult. Plans for increases to property portfolios will almost certainly have to wait, as will sales of rental properties.
Meanwhile, there has been no significant relaxations in landlord legal responsibilities either towards their tenants or their properties – although there have been some modifications in the way these responsibilities may be fulfilled.
There is some financial assistance available, but this is limited. There is also financial assistance available to most, but not all, tenants.
Meanwhile, landlords will have much to do – not least to promote a dialogue with their tenants so that both parties to the rental contract can limit the damage of the current crisis. Needless to say, such dialogues will be best conducted at long range – by email, phone or video link.
This need for communication between landlords and their tenants is emphasised in ‘non-statutory guidance for landlords and tenants‘ issued by the Government.
Government restrictions and advice do not change the legal relationship between landlords and tenants. Tenancy agreements continue to apply and rent remains payable in full. The big difference is that landlords have no way of enforcing this – repossessions have been halted and small claims court proceedings have little hope of going ahead for the time being, at least.
The Government suggests: ‘An early conversation between landlord and tenant can help both parties to agree a plan if tenants are struggling to pay their rent. This can include reaching a temporary agreement not to seek possession action for a period of time and instead accept a lower level of rent, or agree a plan to pay off arrears at a later date.
Where a landlord does choose to serve notice seeking possession for rent arrears or has done so already, the notice period and any further action will be affected by legislation lengthening the notice period (to three months) and/or the suspension of possession claims. If a landlord and tenant agree a plan to pay off arrears at a later date, it is important they both stick to this plan, and that tenants talk to their landlord immediately if they are unable to do so.’