29 Mar 2021

In the first anniversary of the initial ban on repossessions, it appears the move has backfired spectacularly.

Research for the National Residential Landlords Association has shown that there are an estimated 840,000 private tenants who have built rent arrears since lockdown measures began. 

With no action possible against them, these debts are increasing to the point where there is no hope of many being able to afford to pay them back. 

The outcome will be that most will have to leave their homes as emergency measures taper down from June, warns the NRLA.

On top of this, the damage such debts could have on credit scores will cause tenants difficulties when wanting to move home.

The association says that although most landlords have been working with struggling tenants to help keep them in their homes as far as possible, 60 per cent have lost rental income as a result of the pandemic. 

Of these, 39 per cent said the losses were continuing to increase.

The situation for landlords is being made worse by the strains that the courts are now under in hearing the relatively few cases that are being allowed to go ahead. 

It is taking an average of a year from a private landlord making a claim to repossess a property to it being enforced. This is despite cases currently being considered by the courts being the most serious including those related to tenant anti-social behaviour and other criminal activity and where rent arrears were building before lockdown measures started last year.

With the government now working to taper down emergency restrictions in the sector, the NRLA is renewing its call for an urgent financial package to pay off rent debts built as a result of the pandemic. 

Government guaranteed, interest free hardship loans should be available for the majority of tenants now in arrears but who do not qualify for benefit support, the NRLA urges; it also wants grants to be made available for those in receipt of benefits.

The association additionally wants courts to make much better use of technology to ensure that legitimate possession cases can be heard more swiftly. 

This would make it easier for tenants to attend hearings by video – which currently very few do in person. 

NRLA chief executive Ben Beadle says: “Whilst many landlords and tenants have worked well in responding to the challenges posed by the pandemic, we are now at a crunch point. 

“As the country follows the roadmap out of lockdown, so too emergency measures in the rental market will need to be eased.

“Ministers need to ensure the tenants have the financial means to pay off rent debts built as a result of the pandemic. Without this they will have to accept the inevitable consequence of rising homelessness and damaged credit scores.”

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