Covid-19 and the rental market-one year on
It is now a year since the first regulations came into effect restricting repossessions in the private rented sector in England in response to the COVID-19 pandemic.
Since then, many restrictions remain in place, including:
- The notice period for landlords to regain possession of a property is six months in all but the most serious of circumstances[ii]. These measures are set to remain in place until 31st May 2021.
- Most writs and warrants of possession granted by the courts cannot be enforced apart from the most egregious cases such as those where tenants have committed anti-social behaviour, have obtained a tenancy by providing fraudulent information or have built six months or more of rent arrears[iii].
- Court rules introduced in September 2020 are also limiting the number of possession cases being heard[iv].
An analysis of research for the NRLA suggests that 840,000 private renters in England and Wales could have built rent arrears since the COVID-19 pandemic began last March.
The NRLA commissioned the research company Dynata to survey 2,077 private tenants in England and Wales concerning the impact of COVID-19. They were questioned between 17th November and 9th December 2020.
Key findings
- 7% had built arrears due to COVID. Applied across the sector that would amount to 840,000 tenants.
- 18% of those in arrears had rent debts of more than £1,000.
- 11% of private renters are now unemployed.
- Younger people are most likely to have been affected with 14% of renters aged 18 to 24 and 10% of those aged 25 to 34 having built arrears since March.
The impact on landlords
The NRLA ran a survey of its members in England and Wales online between 5th December 2020 and 18th January 2021 to which 1,391 landlords responded. It found that:
- 60% had lost rental income as a result of the pandemic.
- 14% of all respondents said they had lost more than 20% of their rental income.
- 39% of those who had lost rental income, said the losses were continuing to increase.
- 65% said that the pandemic was likely to have a negative impact on their lettings business.
- 34% said they were more likely either to leave the market entirely or sell some of the properties they rent out.
The vast majority of landlords are not millionaire property tycoons:
- 94% rent property out as an individual.
- 45% rent out just one property.
- 44% became a landlord to contribute to their pension[i].
Financial Support
As emergency measures in the sector taper down, the Government needs to develop an urgent financial package to help those tenants affected pay down rent debts built since lockdown measures started in March last year in order to reduce pressure on the courts.
To read key findings from the report click below
COVID and the rental market one year on
Notes
[i] On 26th March 2020 measures were introduced to increase to three months’ the notice period landlords needed to give to repossess a property. The 27th March 2020 also saw the start of a suspension of all ongoing housing possession action in England and Wales for a period of 90 days.
[i] MHCLG, English Private Landlord Survey 2018, January 2019, available at: https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/775002/EPLS_main_report.pdf.
[ii] Details of the exemptions can be read here.
[iii] Full details of the exemptions can be found here.
[iv] Courts and Tribunals Services, Resumption of Possession Cases, 17th September 2020, available here.