Tuesday, February 27, 2024

Government announces further extension to eviction ban

THE government has announced a further extension to the current ban on bailiff-enforced evictions in England until May 31.

Bailiff-enforced residential evictions in England had been due to remain on pause until the end of March, but will now expire two months later with renters only having their homes possessed in the most serious circumstances, such as incidents of fraud or domestic abuse.

The rule stating that private landlords are required to give tenants six months’ notice of eviction has also been extended until at least May 31st.

The ban on commercial evictions will separately be extended by three months to June 30 in a move aimed to support businesses who have been hit hardest by the fallout of the pandemic, such as bars and restaurants.

Robert Jenrick, Housing Secretary, said: “It is right that as we move through the roadmap, we ensure that businesses and renters continue to be supported.

“We have taken unprecedented action to support both commercial and residential tenants throughout the pandemic – with a £280bn economic package to keep businesses running and people in jobs and able to meet their outgoings, such as rent.

“These measures build on the government’s action to provide financial support as restrictions are lifted over the coming months – extending the furlough scheme, business rates holiday and the Universal Credit uplift.”

However, according to the NRLA, the extension continues to leave many landlords in financial turmoil as they operate without receiving rental income.

Ben Beadle, chief executive of the National Residential Landlords Association, comments: “The further extension to the repossessions ban will do nothing to help those landlords and tenants financially hit due to the pandemic.

“Given the cross-sector consensus for the need to address the rent debt crisis, it suggests the government are unwilling to listen to the voices of those most affected.

“If the Chancellor wants to avoid causing a homelessness crisis, he must develop an urgent financial package including interest-free, government-guaranteed loans to help tenants in arrears to pay off rent debts built since March 2020.

“This is vital for those who do not qualify for benefit support. Without this, more tenants face losing their homes, and many will carry damaged credit scores, making it more difficult to rent in the future and causing huge pressure on local authorities when they can least manage it.”

Timothy Douglas, Policy and Campaigns Manager, ARLA Propertymark, comments: “The UK Government has yet again extended the ban on evictions in England, without putting any additional and specific measures in place to support the sector. With the furlough scheme extended until September, it is likely that we will see further changes in the months ahead. To this end, we urge the UK Government to consider a wider strategy and plan for how the sector can deal with rent arrears and the backlog of eviction cases, to avoid a mounting crisis.

“As the impact of Covid continues to bite with household debt and unemployment rates rising, we remain concerned about how tenants will avoid future rent arrears and landlords will remain incentivised to stay in the market. Rather than short term measures that are not helping those renters that need it most, the UK Government must focus on providing long-term support to help renters clear the debt and arrears they have built up during the pandemic.”

Melanie Leech, chief executive, British Property Federation, said: “The government has acknowledged that the majority of tenants and property owners are working well together – with tenants being transparent about their finances, and property owners supporting those in distress with emergency relief and new, longer-term rent payment arrangements. New, stronger relationships have been built through this process. Nevertheless, there is a minority where relationships have broken down and become toxic, and the continuation of the moratorium will do nothing to unlock the stalemate and allow the market to reset and recover.

“With further rates relief and new grants, and a clear plan for re-opening, high streets businesses should be confident in approaching their property owners to forge an economic partnership in which they can agree how to manage rental debt fairly. Rational property owners want their tenants to thrive – empty properties generate no income and are a blight on our high streets.

“As they prepare to re-open, in premises which property owners and their agents have kept safe and well-maintained, the scandal of those well-capitalised businesses who can pay rent, but have chosen not to, cannot be allowed to continue. Their behaviour has raided our nation’s pensions and savings invested in commercial property, and has been a heavy blow for already stretched local authority landlords and public finances.”

Alison Hardy, partner at law firm Ashurst, commented: “The government has yet again applied a blanket approach, protecting all corporate tenants, regardless of whether the pandemic is still affecting their business, rather than adopting a more nuanced sectoral approach. Rather than taking their foot off the brake gently, the government has simply moved the cliff edge to June 30th 2021. Landlords had been speculating whether the extension of furlough to September 2021 would mean that this ban on evictions would also be extended by the same period. Landlords will be unsurprised if the government repeats a further extension of the ban to September in due course.

“In the meantime, we can expect to see more landlords drawing down on rent deposits, recovering monies from guarantors and clogging up the courts with debt actions. The High Court has seen so many debt claims being issued by landlords for rent arrears that it is starting to triage those claims and push them down to the Central London County Court Chancery List.

“We have seen that the measures to date have propped up several businesses that might otherwise become insolvent or entered into CVA arrangements. We expect to see the ban on statutory demands and winding up petitions will be similarly extended. That, together with an extension of the government support packages, and some pending court challenges to CVAs is likely to see insolvencies put off for a further period of time.”


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