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Coronavirus Advice From iHowz & the NRLA

Covid19iHowz

iHowz (formerly the Southern Landlords Association) have summarised some very useful advice for landlords on everything from how do you go about Gas Safety inspections when a tenant is self-isolating to what are the new rules on eviction. (Thanks to iHowz for allowing us to share) This has been updated with links to the NRLA webinar and information on this topic.

The iHowz update for Coronavirus March 2020 (This was sent this to all current and ex-members of that association. Subsequent updates will only go to members).


Evictions

The Government have stated that no tenant will be evicted because of the Coronavirus.

Currently we do not have any actual news on this but anticipate (i.e. guess, not know for certain) they will stop the use of Section 21, and Section 8, Grounds 8;10 & 11.

We don't anticipate this will be backdated, so any cases going through will probably be allowed to continue.

Keep an eye on the news section for any updates.

We have been getting unprecedented calls to the help-line from members concerned that the tenants are being given a rent holiday.

This is most certainly not the case; the Government are keen to ensure any tenant who is suffering financial hardship as a direct effect of the coronavirus outbreak will not suffer unnecessarily.

In fact the Housing Secretary Robert Jenrick said: "The government is clear - no renter who has lost income due to coronavirus will be forced out of their home, nor will any landlord face unmanageable debts.

These are extraordinary times and renters and landlords alike are of course worried about paying their rent and mortgage. Which is why we are urgently introducing emergency legislation to protect tenants in social and private accommodation from an eviction process being started.

"These changes will protect all renters and private landlords ensuring everyone gets the support they need at this very difficult time."

Steps to take:-

  • more than ever it is critical to keep an eye on your business. Normally we urge you to visit the property to inspect, but you will provably want to minimise that, but
  • always check you are getting the rent(s) due, on time
  • keep in contact with your tenants
  • if they have stopped paying rent, ask them why. The answer 'Coronavirus' on its own is not acceptable
  • whatever the reason they give you for not paying, ensure you keep a log of conversations; reasons given to you; and most importantly what the tenant is doing to mitigate their circumstances.

Remember the Government:-

  • is to raise the Local Housing Allowance (LHA) to fully cover 30% of the rents in every area;
  • Universal Credit will be raised by £1,000 a year
  • The "standard allowance" - £323.22 a month for single people and £507.37 a month for couples - will be raised for the next 12 months.
  • Working Tax Credit will be raised by the same amount.
  • The government will also suspend the minimum income floor in Universal Credit "for everyone effected by the economic impact of coronavirus".
    This means a self-employed person with zero income will be able to claim Universal Credit at a similar rate to someone who is unemployed.
    It will mean "every self employed person can access Universal Credit at rate equivalent to Statutory Sick Pay," the Chancellor said.

Additionally:-

  • The government will pay 80% of salary for staff who are kept on by their employer, covering wages of up to £2,500 a month
  • However, we are still waiting for an announcement on help for self-employed people.

So most tenants won't suffer a total loss of income leading to them being unable to pay all their rents.

Most of all, communicate; communicate; communicate.

If you do suffer from some loss of rent we suggest you take the following steps with your tenant(s):-

  • re-assure them them that you want to work with them, to minimise any problems;
  • however, remind them they have a contractual duty to pay rent; also remind them there is considerable Government assistance coming on stream soon, and it is their responsibility to take advantage of any such assistance.
  • Be prepared to assist them make the application. However much of it will be automatic - Universal Credit/LHA will automatically rise; if they are employed it is up to their employer to apply for the Government grant to pay (ut to) 80% of their salary.
  • keep your rent schedule up to date.
  • Be prepared to accept a reduction in rent. If they are getting only 80% of their salary, surely it is better for you to also accept a reduced rent on the basis some rent is better than none - especially as you can't evict.
  • If you believe the tenant(s) is actually capable of paying, and just taking advantage remind them that you can still pursue a claim for rents due through the courts (Money Claim On Line) even if you can't start eviction proceedings.
  • you might want to send them a Letter Before Action, but please only use this kind of action for a genuine case where the tenant can't claim they have lost income due to the Coronavirus. Courts will not take kindly to action brought to someone who has genuinely lost income because of the Coronavirus.

Self-Isolating Tenants

Other considerations for your tenants are those who have to self isolate, especially any who have no-one to help them.

On the rare occasions you can find food in the shops can you do their shopping as well, or help them apply for home delivery (assuming you can now find one).

Establish whether they need their medicines renewed. If they are not able/willing to apply online you might be able to drop their repeat prescription off at the surgery; put a note on it that the applicant is self isolating.

If you can email your tenants, then send them the link to NHS advice: https://www.nhs.uk/conditions/coronavirus-covid-19/ or consider printing it and dropping copies off at the property.

If you are running an HMO try to encourage the tenants to stay in their own room, and to ensure they don't share crockery; cutlery; towels, etc.

Other financial considerations for landlords:-

  • consider applying for a mortgage 'holiday'. But remember that this doesn't meant you will be let off payments completely, so check the terms of this offer.
    • Will the bank/mortgage company as to the terms of such an offer?
    • Will the 'holiday' be added to the end of your term, meaning you will be paying interest on interest?
    • Or will they expect the missing amount to be made up in a stated amount of time?
    • Will a mortgage holiday affect your credit rating for the future?
    • Be aware of what you are agreeing to.
  • To apply for a mortgage holiday you must:
    • For buy to let landlords the key criteria is that their tenant must have been directly or indirectly affected by the coronavirus.
    • The other key criteria is that you must be up to date on your current mortgage payments.
  • Keep an eye on advice - see our colleagues at Mortgage for Business. See also the advice given by the Money Centre.
  • Consider getting advice from an Independent Financial Adviser (IFA)
  • Note that The City regulator has told banks and building societies that they must not repossess people's homes during the coronavirus crisis, and cannot charge fees for payment holidays granted as a result of the pandemic.
  • To ease cash flow pressures for UK VAT registered businesses, VAT bills from now until the end of June, will be deferred until the end of the tax year.

Maintaining Properties

Finally, don't forget you still have to maintain your property.

If your gas safety inspection is due soon don't forget you can get it done up to two months before it expires, but you have to inform the engineer of the expiry date, they won't automatically check like when you get your MoT renewed.
Note that if you cannot get an inspection done, either because of a lack of engineers, or more likely, the tenant won't allow access you must contact both Trading Standards and your local Environmental Health Officer to advise them of the situation. Where possible you must get one done as it is a criminal offence not to have a gas inspection report (CP12).

You will still need to ensure all new lets will require an electrical certificate from July 1st this year. To be specific this is draft legislation and has not become law yet - don't rely on it not becoming law.

There was a shortage of qualified people to issue these certificates; I assume this has got worse.

And any property having an EPC rating of 'F' or 'G' will not able to be rented from April 1st (just over a weeks time) - unless they have an exemption.

Above all, keep a level head, and don't panic unnecessarily.

Copyright © 2020 iHowz Landlords Association, All rights reserved.
You are getting this because you are either a current, or lapsed member of the association. We felt it sufficiently important to send to everyone.

Our mailing address is:

iHowz Landlords Association

Riverside Business Centre
River Lawn Road
Tonbridge, England
TN9 1EP
United Kingdom

NRLA Webinar on Coronavirus for Landlords
 

In addition to the iHowz advice, there is a useful NRLA webinar on this topic which is worth listening to, find it here:   https://youtu.be/M4rmp2q9NzI  

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