Changes to the eviction ban which now allow eviction notices to be issued in the most serious of cases is welcome news for landlords whose tenants have fallen significantly behind on rent.
Here, solicitor and debt recovery specialist Katie Lofthouse explores what the changes mean for landlords who own residential property.
An arrears crisis
According to the Resolution Foundation, almost half a million people are expected to have fallen behind on rent payments due to the pandemic, with research revealing an estimated 450,000 private renters are in arrears.
While mortgage breaks have been offered to homeowners and promises extended to renters that no person would be evicted from their home due to the pandemic, little financial protection has been offered to landlords.
As a result of the third lockdown, evictions have now been extended for a further six, with bailiffs unable to carry out evictions until at least the end of March. But two key changes to emergency legislation – which originally came into force in March 2020 to prevent landlords from evicting tenants in arrears – has provided a lifeline for landlords.
There has always been some exemptions to the eviction ban including trespass, antisocial behavior and substantial rent arrears. Although these will remain in place, the definition of ‘substantial’ rent arrears has now been reduced from nine months to six months.
More importantly, previously landlords were only able to obtain a possession order and start the process of repossessing their property if the renter had built up nine months of arrears prior to March 23, 2020. Any arrears incurred after the first lockdown were unable to count towards the nine-month threshold.
Under the new laws, there is no stipulation that rent arrears after 23 March 2021 cannot count towards the new six-month arrears requirement.
This tweaks to the legislation mean landlords are now able to start possession proceedings in cases where renters have fallen behind on rent payments for six months, regardless of the dates the arrears were built up.
While it’s a balancing act for the government to protect tenants while also supporting landlords affected by the ongoing restrictions, many landlords who have suffered hardship as a result of rent arrears and their previous inability to start possession proceedings will welcome the changes.
Those that meet the new six-month arrears threshold and criteria are urged to seek specialist legal advice.
Katie Lofthouse is a solicitor based at WHN’s Clitheroe office who specialises in contractual disputes and debt recovery. To contact Katie, call her on 01200 408300 or email firstname.lastname@example.org