Government needs to prevent rent debts, not let them grow
Ministers need to do more to prevent tenants building rent arrears, with the NRLA warning current plans will only see them grow.
The call comes as the Government’s Renters’ Rights Bill proposes increasing the amount of arrears a tenant can build from two to three months of rent before landlords can serve notice to repossess a property.
In addition, the Bill seeks to double the notice period landlords must give in such cases, before waiting an average of seven months for the courts to process and enforce such claims.
The NRLA is warning that allowing tenants to build yet more arrears will make it impossible for many to pay them off. It will damage tenants’ credit ratings, limiting their ability to access housing and other services in the future.
To ensure fair treatment for both tenants and landlords, the NRLA is calling for:
• Landlords, and letting agents to be required to work with tenants at the first sign of rent arrears building to tackle them early on. The Government and the courts should adopt the NRLA’s ready-made ‘golden rules’ as the blueprint to help such discussions. These were cited as best practice by the Government to help tenants with rent arrears during the COVID-19 pandemic.
• Certainty for tenants and landlords by keeping housing benefit rates linked to market rents for the duration of this Parliament.
• Confidence for responsible landlords that they can swiftly repossess properties where arrears build to two months of rent as at present, rather than allowing them to build indefinitely.
Ben Beadle, Chief Executive of the NRLA said: “Preventing rent arrears from building in the first place should be the priority for landlords and government, not allowing them to build yet further. Landlords should be making every effort to help tenants get on top of debts as early on as possible.
“However, landlords should rightly expect that they can swiftly regain possession of the properties they rent when tenants reach two months of arrears as at present. In no other walk of life would the Government allow consumer debts to build for months on end with all the damage that can cause to their credit ratings.”
More information
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The Bill will come up for its second reading in the House of Commons on Wednesday, with committee stage shortly after. At this point amendments may be tabled though, given the Labour majority, it is unlikely that further changes to the Bill will happen.
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The NRLA's annual Landlord Conference, being held on November 6 will offer a unique opportunity for property professionals to find out more about the Bill - and the changes we can expect to see - from expert speakers from across the industry. Tickets for the event, which will be held at Birmingham's NEC, are selling fast, so to find out more and book your place, click here.
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And keep an eye on our Renters’ Rights Bill hub for the latest news.
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The NRLA is also running a second member webinar following the second reading of the Bill on October 9. The 'Renters' Rights in focus: understanding key aspects of the second reading' webinar will offer invaluable insights into the upcoming reforms, including how they will be implemented and their potential impact on landlords and the wider housing market. We will also update members on what we are doing to advocate for landlords during this time. The webinar will be held on Zoom on 14 October, between 12pm and 1pm. For more information and to register click here.
