Category: TimeLine

The Complete 2020/2021 Landlord Tax Guide

The Complete 2020/2021 Landlord Tax Guide

We are in the middle of an unprecedented health crisis, which is also impacting business and personal finances nationwide. Some tax changes are being introduced as part of the Government’s wider measures designed to mitigate the economic impact of the pandemic, though these are not directly related to buy to let. See our Coronavirus guide for up-to-date information, and ensure you communicate any changes to your financial situation to HMRC. 

Property taxes can be a complicated business, especially for new landlords. In the flurry of activity around getting your property ready to rent, choosing a tenant and planning what you’ll do with your anticipated new income, it’s all too easy to forget about tax.

Getting on top of capital gains tax, stamp duty, corporation tax, expenses and all the other things landlords have to think about can be a minefield. That’s where this guide comes in. As much as is humanely possible, we’ll tell you what you need to know and do about the taxes you’ll pay as a landlord, how to ensure you’re paying your fair share, clarify key terms, and give you the most up-to-date info about all things tax for 2020/21.

We can’t guarantee edge-of-your-seat thrills and spills, it’s tax after all, but we will touch on the most crucial things you need to know for the coming year and beyond. In this guide we’ll address:

  1. What taxes do landlords pay?
  2. Tax effective property ownership
  3. Property expenses – what you can and can’t claim
  4. Extra tax savings for married couples
  5. New buy to let tax changes for 2020/2021

Bear in mind, this guide is meant as a general overview of the current tax landscape. For further, more in depth personal tax advice tailored to your specific requirements and circumstances, make sure you seek professional advice from a tax specialist.

1. What taxes do landlords pay?

Let’s begin by looking at what property taxes exist, and when they have to be paid.

There are three key moments to think about in the property tax lifecycle.

You pay tax when you buy a property, every year you let the property, and later when you sell it.

If you buy a property over a certain price in the UK, you are eligible to pay tax. The exact tax you pay and the specific value of the property that triggers it, will be different depending on your location and circumstances; and you should always seek professional advice for personal tax related queries.

In England and Northern Ireland, individuals pay Stamp Duty Land Tax (SDLT) on residential properties worth £125,000 or more, and on non-residential properties or land worth £150,000 or more. You must send an SDLT return to HMRC and pay your SDLT within 30 days of completing the purchase. Your solicitor, agent or conveyancer, if you have one, can do this on your behalf, or you can file a return and pay the tax yourself.

Property buyers in Scotland pay Land and Buildings Transaction Tax (LBTT) on residential properties worth more than £145,000, and on non-residential properties worth more than £150,000. Scotland also has an Additional Dwelling Supplement, payable on properties worth more than £40,000.

You pay this if you already own a residential property and buy another. All LBTT is paid to Revenue Scotland through an online portal.

Property buyers in Wales pay Land Transaction Tax (LTT) on residential properties worth more than £180,000, and on non-residential properties worth more than £150,000. As in Scotland, there are additional charges for residential properties worth more than £40,000 if you already own a residential property and are buying another. You must send an LTT return to the Welsh Revenue Authority and pay your LTT within 30 days of completing the purchase. Your solicitor, agent or conveyancer can do this on your behalf, or you can file a return and pay the tax yourself.

These are only the basic rules. If you’re buying for the first time, the thresholds for paying stamp duty are generally higher, so you may not have to pay. If you’re buying-to-let, stamp duty rates are tiered and start at a lower value than those for other home buyers. In England, the rates look like this:

Property price
Buy to let stamp duty rate
£0 – £40,0000 percent
£40,001 – £125,0003 percent
£125,001 – £250,0005 percent
£250,001 – £925,0008 percent
£925,001 – £1.5 million13 percent
£1.5 million +15 percent
Payable Taxes Table

While you’re letting property – income tax

If you make money from letting a property, you may have to complete a self-assessment tax return, depending on your total income.

The rate of income tax you pay varies by income. In England, Wales and Northern Ireland, from 2020/21, you pay no income tax if you earn less than £12,500 per year. You pay the basic rate – 20 per cent of your income – on anything after that income, up to and including £50,000.

The higher rate of 40 per cent tax applies to incomes over £50,000 – and if you make more than £150,000, you pay the additional rate of 45 per cent.

In Scotland, you will now pay no income tax if you earn less than £14,585. The higher rate of 40 per cent tax will apply to incomes over £43,430, while the top rate of 45% will remain the same at £150,000.  

As a landlord, you’re entitled to a £1,000 tax-free property allowance: if you make less than £1,000 a year from letting property, you don’t need to tell HMRC. If you are self-employed as a landlord – in other words, you don’t run a limited company and you file a self-assessment tax return – you’re also entitled to a £1,000 tax-free trading allowance.

If you make between £1,000 and £2,500 a year from letting property, you must make HMRC aware of the fact in order to pay tax. If you make between £2,500 and £9,999 after allowable expenses, or over £10,000 before allowable expenses, you will need to make a self-assessment tax return and may have to pay income tax.

If you’re filling out a paper form to make your self-assessment tax return, you must do this by 31 October each year. If you’re returning your self-assessment tax return online, you must do so by 31 January each year. Missed the deadline? Not to worry – here’s what you should do. 

The expenses you are and aren’t allowed to claim for are complex: we’ll cover those later

You may also have to pay class 2 National Insurance, if you’re running a business and:

  • You make more than £5,965 a year from letting property
  • Being a landlord is your main job
  • You rent out more than one property
  • You’re buying new properties to let out

You can also choose to pay National Insurance payments even if you’re making less than £5,965 a year from letting property, to keep your state pension topped up.

When you sell property – capital gains tax

When you sell a property that’s not your home – a house you bought, renovated, and let out for instance – and make a profit, you may be liable for capital gains tax. You may also be liable to pay capital gains tax on inherited property. 

From 6 April 2020, the annual exempt amount for individuals and personal representatives will increase from £12,000 to £12,300. For trustees of settlements, the annual exempt amount will increase to £6,150.

HMRC provide a tax calculator for working out how much capital gains tax you have to pay, if any. The calculation is based on the gain – meaning the market value of your property, minus any estate agents’ fees, solicitors’ fees, and the costs of major improvement works (building an extension would be included in the calculation; redecorating would not).

The level of capital gains tax differs for basic rate taxpayers, but it is currently set at 28 per cent for higher and additional rate taxpayers

UK residents now have to pay within 30 days of completing the sale. They were previously able to wait until the end of the tax year to include it in their annual tax return.

You may have heard of ‘lettings relief’. This was a reduction in capital gains tax for landlords who lived in the properties they let out. From April 2020, lettings relief will only be available for live-in landlords who are in shared occupation with their tenants.

You may still qualify for private residence relief, however. This is a percentage reduction in capital gains tax, based on the number of years you lived in a property plus the last nine months before you sold it.

Let’s say you lived in a property for five years, then let it out for 15. You would get private residence relief for those first five years, plus the last nine months you rented it out. Five years and nine months is 28.7 per cent of the time you owned the property. You’d therefore gain private residence relief on 28.7 per cent of the gain you make when you sell the property.

Corporation tax vs. income and capital gains tax

Businesses are taxed differently from individual taxpayers, instead of income and capital gains tax they pay corporation tax.

So if you choose to do business as a limited company rather than as a private individual, you may have to register for corporation taxfile a corporation tax return, and either pay corporation tax or report that you have none to pay.

What about landlords with more than one property?

Many landlords have several properties. When this is the case, tax liabilities are considered much the same as when running any other business.  For self-assessment, all rents and expenses from similar properties are pooled together into a single figure. This means you have to divide your properties, rents and expenses up along the following lines:

  • UK rentals – any buy to let or shared house rented out on a shorthold tenancy
  • Overseas rentals – any properties abroad let on a long lease
  • Holiday lets – homes located within the European Economic Area that qualify as furnished holiday lets. Holiday homes outside the EEA slot into the overseas rental category.

2. Tax-effective property ownership

Managing your portfolio to pay your fair share of tax is not easy. The next step in our tax guide for new landlords focuses on who has to pay tax, how multiple properties and portfolios are taxed, and what happens if you make a loss. For accurate tax advice tailored to your personal circumstances, always consult a professional. 

Who pays property tax?

Whoever benefits from owning a property pays the tax. Finding that person means following the money and dividing it between owners, or those who are paid from it, such as property managers.

Example

Imagine you’re letting out a property and allowing someone else to keep the money in return for managing the property. Even though you don’t receive a penny of rental income, you need to declare this on a self-assessment return, indicating where the money ends up – in this case, with the third party acting as your agent.

You need to do this to avoid tax mismatches. Property owners who pay higher or additional rate income tax sometimes attempt to hide their income and reduce their tax bills by passing off someone else – a basic rate taxpayer – as the person who benefits from the income. There are ways to do this legally, either by transferring allowances within a marriage or civil partnership, or forming a business partnership, but misrepresenting your tax situation by hiding where the money goes is not one of them.

What happens if a landlord makes a loss?

For tax purposes, you make a loss if your allowable expenses come to more than your rental income during a year. This loss is carried forward to offset against your future rental profits. 

You cannot store up losses to use when it suits you – for instance, to avoid becoming liable for higher rate income tax. You must offset losses against available profits each year, until they are exhausted.

Example

Your property earns £15,000 each year in rent.

In the 2018/19 tax year, your allowable expenses come to £18,000, leading to a £3,000 loss for the year. You pay no tax that year.

In 2019/20, you bring your expenses under control – down to £13,000 – and make a £2,000 profit. The loss from the previous tax year is deducted from your profit. You carry forward a loss of £1,000, and pay no tax for 2019/20.

In 2020/21, your expenses come down further, to £11,000. You’ve made a profit of £4,000. Deduct the loss of £1,000 to leave a taxable income of £3,000. You’re now liable to pay income tax.

3. Expenses – what you can and can’t claim

As a landlord, you should claim property expenses. Every pound spent on a property reduces profits, which reduces your income, which reduces your tax liability. It’s not tax avoidance – it’s paying your fair share; no more and no less.

If you’re self-employed, you’re entitled to a £1,000 tax-free property allowance, and another £1,000 tax-free trading allowance. However, if you’re claiming your £1,000 tax-free ‘trading allowance’, you cannot claim any business expenses. The allowance is there for low income side businesses – chances are that you have more expenses and more income to handle.

You should only claim tax-free trading allowance if your total income from letting property is between £1,000 and £2,000 a year.

Landlords can easily overlook rental income that they should include in a self-assessment tax return. If you retain money from a deposit to pay for repairs or cleaning when a tenant leaves, for example, this must be included in your tax return.

Example

You retain £500 from a £750 deposit to clean carpets and redecorate after a tenant leaves your property. You must add that £500 to the income you declare on your tax return. You must also add it to the allowable expenses you claim on your tax return, by including the bills for cleaning and redecoration.

The same logic applies if the tenant pays for extra services throughout the year, like gardening costs, or if you reduce the rent to repay a tenant for the cost of a repair they carried out. When you fill in your tax return, you still add the full rental income, but you also add the bill for materials and tradesmen paid for by the tenant as allowable expenses.

You are the landlord – you benefit from owning the property – the tax liability and the book-keeping responsibility both lie with you.

What are self-employed landlords allowed to claim as income tax expenses?

HMRC provides a checklist of allowable income tax expenses for landlords. Exactly what you’re allowed to claim will vary depending on whether you’re letting a residential property, a furnished holiday let or a commercial property.

Residential landlords can claim for the day-to-day expenses of running their properties, including:

  • Bad debts
  • Business costs like phone calls, travel and running a home office
  • Fees for services by professionals like accountants, letting agents, solicitors or surveyors
  • Ground rent on the property
  • Insurance cover, including for buildings, contents, and rent guarantee
  • Interest on loans and credit purchases
  • Repairs to and replacements for the property
  • Services like cleaning or gardening
  • Utility bills and council tax (while the property is unoccupied)

Some of these are straightforward, but some – especially business expenses, interest and repairs – often trip up new landlords. We’ll cover those in more detail.

Bad debts

Rent arrears are the most likely bad debt for a property business.

A debt does not become ‘bad’ just because someone owes the money. The landlord must make some reasonable effort to recover the money, like launching court proceedings or passing the case to a debt collector. Once it’s clear that the debt will not be recovered – if the tenant declares bankruptcy, for example – the debt has gone bad, and become a business expense.

Business costs

HMRC publishes guidance on allowable expenses for self-employed people. These include:

  • Office, property and equipment
  • Car, van and travel expenses
  • Clothing expenses
  • Staff expenses
  • Reselling goods
  • Legal and financial costs
  • Marketing, entertainment and subscriptions

A self-employed landlord can claim some of these – the costs of travel with your own vehicle and working from home – using ‘simplified expenses’. Simplified expenses use a flat rate for these costs to avoid complicated calculations: they’re by far the easiest way to claim expenses.

There are some specific things to think about here, as a landlord.

Firstly, your travel expenses. HMRC does not allow you to claim “regular and predictable” travel between your home and your place of work. This means you can’t claim for travelling between your home and your existing properties. You can claim for travelling to view new properties, but only if you end up buying the property.

Secondly, staff expenses. You can pay friends, family and employees who do not own a share of your property, if they’re doing work related to running the property. The rate of pay should reflect the work undertaken – paying your husband £50,000 to keep the books for a buy to let will be treated as tax avoidance. You can also pay for training, as long as you’re reinforcing existing skills. Buying a book or a guide on property tax for landlords is an allowable expense, but signing up for a get-rich scheme for property investors is not.

You can’t use simplified expenses if you’re running your properties through a limited company, or if you’re in partnership with one. For limited companies that you run from home, there are formulas for splitting your bills between personal and business use.

Fees for professionals

These are bills from accountants, agents, solicitors and surveyors.

Costs related to the day-to-day running of the business, like chasing bad debts, evicting tenants in rent arrears and keeping financial records are allowed. Costs related to buying, selling or planning applications for a property are not allowed – they are part of your capital gains tax calculation when you sell the property.

Interest

Landlords used to be able to claim tax relief on interest payments on borrowing to fund business costs such as buying land, property, supplies or refurbishments.

This tax relief has now been phased out.

You now receive a 20 per cent tax credit on these interest payments.

You can only claim the interest – not the actual cash amount – and you must prove the borrowed money was spent on buying land, property or equipment for the property business or funding repairs or improvements.

Repairs and replacements

A ‘replacement’ means replacing or renewing part of the fabric of the property, like a pump for the boiler, a tile for the roof, or a like-with-like kitchen refit.

An ‘improvement’ is a substantial upgrade that adds value: an extension, a loft conversion, or replacing a chipboard and Formica fitted kitchen with an oak and granite one. You can’t claim improvements as expenses for income tax purposes.

You can claim ‘replacement of domestic items’ relief for things like:

  • movable furniture; for example, beds and free-standing wardrobes
  • furnishings; for example, curtains, linens, carpets and floor coverings
  • household appliances; for example, televisions, fridges and freezers
  • kitchenware; for example, crockery and cutlery

Replacement of domestic items relief includes any sale or part exchange of the old item, as well as any incidental costs involved in disposal or delivery.

To claim this relief, you must have bought the item for the property, and removed the old one. You cannot claim the initial cost of fitting out a residential property for rental.

You also cannot claim the full cost of upgrading the item. If you replace a £1000 sofa with a £1200 sofa bed, you’re adding value: you can claim back the first £1000 cost as you’re replacing like with like, but the remaining £200 is an improvement and you can’t claim it.

If you’re letting out a fully furnished property, you can claim Replacement Domestic Item relief, which took the place of wear and tear allowance from 2016. Under this scheme, the initial cost of purchasing domestic items for a dwelling house isn’t a deductible expense so no relief is available for these costs. Relief is only available for the replacement item, including:

  • movable furniture for example beds, free-standing wardrobes
  • furnishings for example curtains, linens, carpets, floor coverings
  • household appliances for example televisions, fridges, freezers
  • kitchenware for example crockery, cutlery

You cannot claim the costs of buying property, getting it into a rentable condition, or making improvements.

These expenses are part of your capital gains tax calculation when you come to sell the property – you had to spend that money to make what you did on the sale, so it’s subtracted from your gain before capital gains tax applies.

You cannot claim “regular and predictable” travel costs – like journeys between your home and office, or between the properties you already rent.

You cannot claim wear and tear allowance on a property you are not letting as fully furnished.

4: Extra tax savings for married couples

Tax rules concerning married couples are complicated but can enable individuals to shift their assets between each other in a legal and above-board way to reduce their tax bill.

Here we will provide an overview of some of the ways in which a couple can do this. However, given the particularly complex nature of tax relating to married couples it may be advisable to consult a tax professional to carry out a full review of your specific situation.

If one of you doesn’t pay income tax: Marriage Allowance tax update

Marriage Allowance can work for couples where one person is earning less than the personal allowance, (which increased from £11,850 in 2018/19 to £12,500 in 2019/20) and the other person pays income tax at the basic rate, which in 2019/20 usually means their income is between £12,500 and £50,000. The marriage tax allowance went up from £1,190 in 2018/19 to £1,250 in 2019/20. This means the potential tax saving from the higher tax earner’s bill in 2019/20 is up to £250.

So, to benefit from Marriage Allowance, you must be married to (or in a civil partnership with) someone who does not pay income tax, or whose income is below £12,500 a year. You must also be a basic rate taxpayer. It doesn’t matter if you live abroad or are receiving a pension – as long as you have a personal allowance for income tax, you can claim Marriage Allowance.

The person with the lowest income needs to claim Marriage Allowance online. It can take up to two months to process the claim. The person with the higher income will get their new personal allowance when they send in their next self-assessment tax return.

If you both pay income tax: setting up a partnership

If you’re both basic rate taxpayers, one option is to set up a business partnership. Business partners share responsibility for any losses the business makes, any bills the business incurs, and the profits from the business – but each partner only pays tax on their share. Setting up a partnership means you can avoid one person moving into the higher rate for income tax.

Example

As a couple, you earn £50,000 from rent. If this is one person’s income, they would pay the higher rate of income tax – 40 per cent. 40 per cent of £50,000 means a £20,000 tax bill.

If this rent is paid to a partnership, and each partner has a 50 per cent share, each partner receives £25,000 in rental income. That only qualifies for the basic rate of income tax – 20 per cent. 20 per cent of £25,000 each is £5,000 each. 

The couple’s total tax bill is £10,000. However if the share of the property is not equal then percentage payments and the rules around it will differ. We advise you contact a property tax professional to assess your percentage split.

You’ll need to choose a name for your business (it can’t be too similar to an existing company’s name), and choose a ‘nominated partner’ who will be responsible for sending the tax return for the business. The nominated partner must register the partnership with HMRC.

Both members of a partnership must be registered with HMRC. Both partners must send their own self-assessment tax returns and pay income tax.

It’s a good idea to set up as a limited liability partnership (LLP). Partners in an LLP aren’t personally liable for debts the business can’t pay – this keeps you safer in the event that your business struggles in future.

If you might pay higher rate income tax: setting up a private limited company

Private limited companies are legally separate from the people who run them, have separate finances from the people who run them, and can keep any profits they make after paying corporation tax.

The advantage of a private limited company is that you can pay yourself a salary within the basic rate of income tax, and have your partner claim Marriage Allowance, or pay your partner a separate salary. The rest of your profits will be paid as dividends to people with a share in the company. Shares can also be bought, sold and transferred if you want to bring more members of your family into the company. It’s a way to make sure you don’t end up paying income tax at the higher rate.

The disadvantage is that it takes more work to set up a private limited company than a partnership.

You’ll need to choose a company name and registered address, appoint directors and a company secretary, establish and issue at least one share, and draw up a memorandum and articles of association which set the rules for running the company.

It’s only worth doing if you make more than £92,700 a year in rental income (the basic allowance for two people).

5. New buy to let changes for 2020/21

As if buy-to-let tax wasn’t fiddly enough, the rules also change fairly regularly. A range of new measures were introduced in the 2020 tax year for landlords to familiarise themselves with.

These include changes to mortgage interest tax relief, capital gains tax allowance and changes to how capital gains tax is paid on rental properties you used to live in. 

Mortgage interest tax relief

The Government began phasing out mortgage interest tax relief by 25 per cent each year in 2017, planning to end it completely by 2021. As a result, 2019 was the last year that landlords could deduct the interest paid on their mortgage from their income.

Instead, landlords are now given a 20 per cent tax credit for all their property finance costs. The aim of the policy is to increase the amount of tax paid by higher or additional-rate landlords, who used to receive generous tax deductions. Basic rate tax-payers should end up paying more or less the same as before.

Capital gains tax allowance increase

There are several changes to capital gains tax, plus how and when it is paid.

First, lettings relief, which used to apply to anyone who was renting out property they used to live in, is now only available to live-in landlords who are in shared occupation with tenants. The next change is to private residence relief. 

This used to be a percentage reduction of your total capital gains tax bill based on the length of time you lived there plus the final 18 months you rented it.

This additional 18 months has been cut in half to nine months. This is a bit complex and you can find a more detailed description of this above if you need it.

Finally, the amount of time the sellers have to pay capital gains tax has been reduced, falling from by the end of the tax year to within 30 days.

Managing your liability

Understanding your own tax liability will help you to make the most out of your property assets.

As we’ve discussed, you pay tax when buying, letting or selling a property; you become liable for higher tax brackets based on the value of the property and your overall income.

Managing your liability is a matter of knowing exactly what you can and can’t claim as expenses.

While there could be further buy-to-let tax moves, keeping accurate records of your costs, staying abreast of changes and always running your decisions past a property tax expert will leave you on the right side of HMRC.

UPDATE: Rental market to remain open during November lockdown

UPDATE: Rental market to remain open during November lockdown

The housing market is to remain open in the four week lockdown in England.

The Ministry of Housing, Communities and Local Government confirmed the news on Saturday evening via Twitter.

A tweet from Housing Secretary Robert Jenrick said: “Q: Can I still move house? A: Yes – the housing market will remain open throughout this period. Everyone should continue to play their part in reducing the spread of the virus by following the current guidance.”

That guidance, originally issued in August, says: “The process of searching for and moving into a new home is different because property agents, conveyancers and other professionals have modified how they work to reduce the risk from COVID-19. These changes could include doing more online, such as offering virtual viewings; vacating your current property during viewings; and ensuring your property is thoroughly cleaned before someone else moves in.

“We encourage all parties involved to be as flexible as possible and to be prepared to delay moves, for example if one of those involved becomes ill with COVID-19 during the moving process or has to self-isolate. It may become necessary to pause all home moves locally or nationally for a short period of time to manage the spread of coronavirus. We will let you know if this needs to happen.

“If you are about to enter into a legally binding contract, you should discuss the possible implications of COVID-19 with your legal professional and consider making contractual provisions to manage these risks. You should not expect to immediately be able to move into any home where people have COVID-19 or are self-isolating.

“Those renting a property, letting agents and landlords should be aware of and follow the government guidance on coronavirus and renting which contains further advice that may also be applicable such as on possession proceedings, repairs, maintenance and health and safety.”

For members of the public – prospective buyers and tenants, as well as vendors and landlords – the same government guidance note says: “You are free to move home. However, you may find the process of searching for and moving into a new home is different, as property agents, conveyancers and other professionals have modified how they work to reduce the risk from COVID-19.

“Initial viewings should be done virtually wherever possible. Property agents should be able to help you with this.

“Members of the public who are visiting an agent’s office or viewing a property should wear a suitable face covering as described in government guidance unless they are exempt from this requirement. This should be confirmed with the agent before arrival. Anyone with concerns should contact the agent in advance of their visit to discuss appropriate measures. The agent may require you to arrange an appointment before visiting the premises.

“All physical viewings where prospective buyers or renters will be entering the property should involve no more than 2 households inside the property at any one time. This includes any agent accompanying either party. Anyone in a support bubble with either household, however, will count as part of that household. 

“Please read the latest guidance on indoor gatherings and support bubbles.

Where prospective buyers who are currently from separate households wish to view the property on the same occasion, we advise that one household leaves the property to allow the other to enter. This allows for both households to view the property and ensures social distancing.

“Viewings should be arranged by appointment only and ‘open house’ viewings should not take place. When viewing properties in person, you should avoid touching surfaces wherever possible, wash your hands regularly and/or use hand sanitiser. If you need to be accompanied by small children, you should try to keep them from touching surfaces and ensure they wash their hands regularly.

If people are being shown around your home, you should open all internal doors and ensure surfaces, such as door handles, are cleaned after each viewing with standard household cleaning products.

“We recommend that you vacate your property while viewings are taking place in order to minimise unnecessary contact.

“Anyone involved in any aspect of the home-moving process should practice social distancing in line with public health advice.

“When moving between properties, you and those in your household should try to do as much of the packing yourself as you can. Where this is not possible, you should speak to removal firms in advance. There is further advice about this below.If you are particularly worried about the risk of infection, then speak to your landlord, estate agent or removers as they may be able to put extra precautionary measures in place.”

Covid-19 & Pre-Tenancy Care

Covid-19 & Pre-Tenancy Care

Making sure the check-in process for tenants is carried out in a smooth manner is more important than ever, in light of the coronavirus pandemic.

Restrictions are tightening across the country again as Britain prepares itself for a fully fledged second wave, and while a second national lockdown seems unlikely, there could be further curbs on everyday freedoms as the weather worsens and the annual flu season begins to rear its head.

But what can you do to ensure the pre-tenancy process is as seamless as possible? Here, we outline some top tips for agents eager to impress clients more than ever this winter.

Communicate effectively

During normal times, good communication is vital when it comes to ensuring a smooth, successful tenancy, but this even more so the case at present, when many people are uncertain and confused about what they can and can’t do.

From viewing protocols to playing by the rules on in-branch appointments, to ensuring all your landlords and tenants know where they stand with regards to tenancy agreements, inventories, fees and Energy Performance Certificates (EPCs), it’s vital that communication is clear and consistent throughout.

Make sure you know the preferred method of communication for your landlords and would-be tenants, so you can contact them via a medium which they are likely to check on a regular basis and respond to. For many, this will still be a call, text or email, but for an increasing number it might be via WhatsApp, Facebook Messenger, FaceTime or other social media platforms.

Emphasise the importance of the tenancy agreement

This is the contract signed between your landlords and tenants, setting out the legal terms and conditions of a tenancy and the rules and regulations tenants must abide by – for example, whether they can have a pet, redecorate or smoke indoors. The tenancy agreement can be written down or be a spoken oral agreement. It is, though, far more preferable for it to be written down somewhere, so there is an evidence trail to follow should any disputes occur at a later date. Tenancy Agreements provided by TLA.co.uk – Visit the Landlord InterACTIVE™ service on the homepage.

The tenancy agreement is something tenants should read carefully before they commit to renting a home, to limit the chances of any issues further down the line. If, for example, a landlord has made it explicitly clear that sub-letting is not allowed and late-night parties are a breach of the tenancy agreement, and a tenant goes ahead and does this anyway, the potential for serious disputes goes up.

Tenancy documents – such as tenancy contracts and tenancy agreements – can be signed electronically with digital or e-signatures holding the same weight as physical ones. In these Covid times, where face-to-face interaction is advised against, and remote solutions are being encouraged, you may want to arrange for landlords and tenants to sign in this manner, as well as prioritising digital deposit registration, digital offers and digital referencing.

Make it digital

In days gone by, tenants would likely have come into the office to complete the application process for a new home and sign their tenancy agreement – as well as potentially stopping by for keys and any other queries.

Even before Covid, the trend for people visiting agent branches in-person had been on the decline, but this has been supercharged by the pandemic, with the government actively encouraging appointment-only visits to branches and pushing for remote solutions wherever possible.

This includes remote viewings in the first instance, to ensure that a tenant is serious about a property before visiting it in person.

On the viewing itself, there are a wide range of protocols that all parties – agent, landlord and tenant – must abide by, from face coverings and social distancing to a limit on the number of people in a property at any one time and no mixing of households.  

If something can be managed digitally at present, this is preferable given the restrictions at play – which are also much stricter in certain parts of the country deemed more at risk of virus spread.

Some of the tenancy process was slowly moving online even before January this year, but the desire for digital solutions – streamlined, simplified and highly effective – has gone up a couple of notches since Covid-19 became a part of our lives.

Too much of the current process is bogged down with paperwork and inefficient systems, but agents using fast, streamlined systems can really stand out from the crowd.

Tenancy admin, and the tenant referencing process, can be cumbersome and time-consuming if you don’t have the right kind of procedures in place to speed these up. Again, this is where digital solutions come into their own.

Know the Covid rules

To ensure a smooth pre-tenancy process, it’s vital that letting agents and landlords adhere to the guidance given by government on how to safely let property during the coronavirus pandemic.

Landlords and letting agents should not conduct viewings in properties where tenants are symptomatic or self-isolating, while any visits to a property must be made in accordance with the government’s guidelines on working in other people’s homes and social distancing.

The government also advises letting agents and landlords to take steps to ensure any properties are ready for new tenants, including cleaning to minimise any potential spread of the virus in line with government advice.

Additionally, it’s recommended that letting agents and landlords consider how best to conduct tenancy check-ins for new tenancies, ‘taking care to follow government advice on social distancing and public health advice’ to minimise the spread of infection. Right to Rent checks can, at present, be conducted remotely due to Covid-19.

The government also suggests that agents and landlords look for ways to ensure that in-person payments, referencing or checks can be conducted remotely instead, taking further legal or professional advice if required to implement these properly.

We know that effortless rental transactions are more crucial than ever at present, and here at Propoly we are doing our bit to make that a reality.

We help your landlords and tenants to get to the move-in-date faster by inviting tenants to submit digital offers, pay holding fees, sign ASTs and pay move-in monies all online with minimal manual effort from your side. You can also generate a deal on behalf of landlords by using details provided by tenants digitally, and generate the tenancy agreement instantly by selecting custom options.

Our software also automatically provides your landlords and tenants with instant updates on every step of the process, from viewing feedback, tenancy documents and status updates throughout the tenancy progression process for landlords, while tenants can see status updates for themselves and co-tenants, and complete their references, signing and paying monies online.

General Landlord Survey Q4 2020

General Landlord Survey Q4 2020

This Survey Takes <2 Mins With 6 Questions. Results Will Be Published On 18th November 2020.

SEPTEMBER: Coronavirus Act 2020 (Residential Tenancies: Protection from Eviction)

SEPTEMBER: Coronavirus Act 2020 (Residential Tenancies: Protection from Eviction)

The Coronavirus Act 2020 (Residential Tenancies: Protection from Eviction) (Amendment) (England) Regulations 2020 was laid on 28 August 2020 and came into force on 29 August 2020

The regulations amend Schedule 29 of the Coronavirus Act 2020 to require residential landlords to give tenants 6 months’ notice of their intention to seek possession, except in the most serious cases. These regulations will only apply in England.

The department wrote to chief executives of local authorities, chief housing officers and chief officers of children’s services in England about the amending regulations on 7 September 2020.

Tenant Fees Act

Tenant Fees Act

Documents related to the Tenant Fees Act, which sets out the government’s approach to banning letting fees paid by tenants in the private rented sector.

The Tenant Fees Act bans most letting fees and caps tenancy deposits paid by tenants in the private rented sector in England.

The ban on tenant fees applies to new or renewed tenancy agreements signed on or after 1 June 2019.

The government guidance on the Act for tenants, landlords and letting agents helps explain how this legislation affects them. You might also find the ‘How to Rent’ and ‘How to Let’ guides useful.

The aim of the Act is to reduce the costs that tenants can face at the outset, and throughout, a tenancy. Tenants will be able to see, at a glance, what a given property will cost them in the advertised rent with no hidden costs.

The party that contracts the service – the landlord – will be responsible for paying for that service, helping ensure the fees charged reflect the real economic value of the services provided and sharpen letting agents’ incentive to compete for landlords’ business.

Local enforcement authorities have primary responsibility for enforcing this legislation. The Tenant Fees Act created an independent lead enforcement authority to provide advice and information to local authorities on the Act. Bristol city council has been appointed as the lead enforcement authority for lettings.

From 1 June 2019, the only payments that landlords or letting agents can charge to tenants in relation to new contracts are:

  • rent
  • a refundable tenancy deposit capped at no more than 5 weeks’ rent where the total annual rent is less than £50,000, or 6 weeks’ rent where the total annual rent is £50,000 or above
  • a refundable holding deposit (to reserve a property) capped at no more than 1 week’s rent
  • payments associated with early termination of the tenancy, when requested by the tenant
  • payments capped at £50 (or reasonably incurred costs, if higher) for the variation, assignment or novation of a tenancy
  • payments in respect of utilities, communication services, TV licence and Council Tax
  • a default fee for late payment of rent and replacement of a lost key/security device giving access to the housing, where required under a tenancy agreement

Tenant Fees Act Guidance

London Landlords Look Set To Lose £65M A Month Because Of Covid-19

London Landlords Look Set To Lose £65M A Month Because Of Covid-19

student 55

The ongoing pandemic is causing travel restrictions and broader health implications for universities. In fact, it’s predicted that the number of students heading to London this term will drop by as much as -24%.

That’s a loss of over £65m a month for the London student rental sector.

London lettings and estate agent, Benham and Reeves, has revealed the best boroughs for student rental demand, despite predictions of a rental market decline due to a lower level of students heading to the capital.

London’s higher education providers accommodate 16% of the UK’s university students each year, and as many as 32% of the capital’s students come from overseas.

The average London student pays £702 a month in rent, meaning those on a three-year course will pay out £8,424 a year, totalling more than £25,000 throughout their course.

This means the capital’s student body brings in nearly £271m to London’s rental market in rent each month, with international students accounting for £85.6m of it.

However, despite this prediction, many areas of London are still experiencing extremely high levels of demand for student accommodation, something that will be welcome news to student landlords across the capital.

According to the research by Benham and Reeves, the number of student-specific rental properties that have already been snapped up by students sits at 22% of all student-specific properties listed on the rental market.

In Merton, for example, this ratio is far higher, with 80% of all student accommodation already let agreed.

Bromley (75%), Bexley (61%), Barking and Dagenham (60%), Hounslow (53%), Harrow (53%) and Redbridge (50%) are also seeing high levels of current student demand for rental properties.

Even in more expensive markets such as Hammersmith and Fulham, Islington and Camden, student rental demand is sitting at 19% to 25%.

Marc von Grundherr, Director of Benham and Reeves, commented:

“There is currently an evident decline in the level of rental demand from students than we might otherwise expect at this time of year. This has, of course, been driven by a lower number of international students looking for properties due to the travel restrictions and other hurdles that the current pandemic has presented.

“However, while predictions of student rental market losses are rather eye-watering, to say the least, we don’t believe this will be an issue that plagues the market for long.

“Many current students are beginning their studies in a virtual capacity until such time they can make a move to London, and once they do, we should see a further influx of demand for suitable student lets.

“University is very much about the life experience you gain from actually moving to a new city or country. With London still offering some of the best standards of higher education you can find worldwide it’s unlikely students will refrain from this first-hand experience unless absolutely necessary.

“Like many areas of life this year, we may see a slow start to the university year. But as life develops to deal with COVID-19, greater degrees of normality will prevail, and this is no different in the rental market student or otherwise.

“The very promising signs are that currently, many boroughs are experiencing massive demand for student rental properties, and this bodes very well for the academic year ahead. Foreign student demand, in particular, can bring very favourable levels of rent for buy-to-let landlords. We regularly have students from China and other areas of Asia renting at well above the average in their chosen areas to ensure they secure the best property they can while studying.”

The average London student pays £702 a month in rent, meaning those on a three-year course will pay out £8,424 a year, totalling more than £25,000 throughout their course.

This means the capital’s student body brings in nearly £271m to London’s rental market in rent each month, with international students accounting for £85.6m of it.

However, despite this prediction, many areas of London are still experiencing extremely high levels of demand for student accommodation, something that will be welcome news to student landlords across the capital.

According to the research by Benham and Reeves, the number of student-specific rental properties that have already been snapped up by students sits at 22% of all student-specific properties listed on the rental market.

In Merton, for example, this ratio is far higher, with 80% of all student accommodation already let agreed.

Bromley (75%), Bexley (61%), Barking and Dagenham (60%), Hounslow (53%), Harrow (53%) and Redbridge (50%) are also seeing high levels of current student demand for rental properties.

Even in more expensive markets such as Hammersmith and Fulham, Islington and Camden, student rental demand is sitting at 19% to 25%.

Marc von Grundherr, Director of Benham and Reeves, commented:

“There is currently an evident decline in the level of rental demand from students than we might otherwise expect at this time of year. This has, of course, been driven by a lower number of international students looking for properties due to the travel restrictions and other hurdles that the current pandemic has presented.

“However, while predictions of student rental market losses are rather eye-watering, to say the least, we don’t believe this will be an issue that plagues the market for long.

“Many current students are beginning their studies in a virtual capacity until such time they can make a move to London, and once they do, we should see a further influx of demand for suitable student lets.

“University is very much about the life experience you gain from actually moving to a new city or country. With London still offering some of the best standards of higher education you can find worldwide it’s unlikely students will refrain from this first-hand experience unless absolutely necessary.

“Like many areas of life this year, we may see a slow start to the university year. But as life develops to deal with COVID-19, greater degrees of normality will prevail, and this is no different in the rental market student or otherwise.

“The very promising signs are that currently, many boroughs are experiencing massive demand for student rental properties, and this bodes very well for the academic year ahead. Foreign student demand, in particular, can bring very favourable levels of rent for buy-to-let landlords. We regularly have students from China and other areas of Asia renting at well above the average in their chosen areas to ensure they secure the best property they can while studying.”

JULY: Safety Checks On Electrical Appliances Become Mandatory

JULY: Safety Checks On Electrical Appliances Become Mandatory

Landlords are already required to make sure that the wiring and appliances in their properties are safe, but from July it will be a legal requirement for private landlords to have their electrical installations inspected every five years and provide safety certificates to tenants and their local authority.

The regulations will apply to all new tenancies from 1 July 2020 and existing tenancies from 1 April 2021.  If serious problems are identified, these will have to be remedied quickly. Local authorities will have a duty to take action if landlords do not comply with the requirements and will be able to issue fines if necessary.

JUNE: Tenant Fees Acts (EXTENTION)

JUNE: Tenant Fees Acts (EXTENTION)

The Tenant Fees Act 2019 came into force in England last year on 1 June 2019. The Act bans landlords and agents from charging fees to tenants other than those expressly permitted by the Act. It also places a cap on the amount of security deposit a landlord or agent can collect and codifies a procedure for dealing with holding deposits. The ban applies to assured shorthold tenancies granted by private landlords, licence agreements and tenancies of student accommodation (referred to collectively as “tenancies” for the purposes of the Act).

Since 1 June 2019 the Act has applied to all new agreements actively granted on or after this date including renewal agreements. In accordance with the Act’s transitional provisions, the ban has not applied to tenancies entered into before 1 June 2019 or to statutory periodic tenancies that arose at the end of fixed-term ASTs that commenced before 1 June 2019. The transitional period has now come to an end and from 1 June 2020 the Act applies to all relevant tenancies in existence. However, there will still be some differences in how the various rules apply depending on when the tenancy was granted and when the payment was taken.

This is part 1 of a 3-part series exploring how the TFA provisions will apply to tenancies from 1 June 2020. This blogpost will explore how the prohibited payment provisions work and why compliance is important.The second blogpost will look at tenancy deposits and how the cap applies to different tenancies. The final blogpost will examine the holding deposit provisions.

How does the TFA apply from 1 June 2020?

The various scenarios are set out below:

New tenancy granted on or after 1 June 2019 including first tenancies and renewal tenancies

As is the case now, the Act applies so no prohibited payment can be taken. Any term in the agreement that requires a prohibited payment is not binding. This applies equally to the first tenancies and renewal tenancies. This is the most straightforward scenario as no payment taken in connection with that new tenancy will be lawful if it is not a permitted payment under the Act. Requesting a prohibited payment will be a breach of the Act.

Statutory Periodic Tenancy that arose before, on or after 1 June 2019

The Act will now apply to these tenancies as the transitional provisions have come to an end. Any term in the agreement that requires a prohibited payment ceases to be binding on the tenant from 1 June 2020. If a landlord/agent accepts a payment by mistake they have 28 days to return it to the tenant otherwise it is a prohibited payment and they will be in breach of the Act.  However, any payment taken before this date (i.e. up to 31 May 2020) will still be lawful as it will have been taken during the transitional period when the TFA restrictions did not apply.

With these tenancies that span the transitional period some payments may have been taken lawfully while later payments may not be lawful. For example, reference fees and inventory fees may have been taken lawfully at the commencement of a tenancy and default fees collected lawfully throughout the tenancy. However, a check-out fee due to be charged at the end of the tenancy will be unlawful if taken on or after 1 June 2020. Difficulties may arise if payments were taken from tenants ‘on account’ at the start of their tenancies when the fee was still allowed but the charge is only actually incurred at the end of the tenancy, for example, to cover a check-out inspection. That fee is likely to be prohibited even if collected before the ban applied and the money should be returned to the tenant.

Tenancies granted before 1 June 2019 including contractual periodic tenancies and tenancies still within their original fixed term

The Act will also now apply to these tenancies as the transitional provisions have come to an end. There is no exemption for tenancies that have a longer fixed-term period or have been contractual periodic tenancies from the outset. The ban applies retrospectively to these tenancies. Again, from 1 June 2020 any term in the tenancy requiring such a payment will cease to have effect and if a payment is accepted it must be returned within 28 days of receipt otherwise it is a prohibited payment and the landlord or agent will be in breach of the Act.

Why is this important? What are the sanctions for non-compliance?

Compliance with the TFA is important because there are serious consequences for breaching the Act. Local authorities and the lead enforcement authority can issue penalties of up to £5000 for each breach of the Act and repeated non-compliance can result in prosecution or a financial penalty of up to £30,000, banning orders and an entry on the Rogue Landlord Database and/or the Mayor of London’s Rogue Landlord Checker. Tenants can also bring claims against the landlord to recover fees charged unlawfully. You can read more about enforcement of the Act here.

One of the biggest deterrents to non-compliance is the restriction on recovering possession from assured shorthold tenants. A landlord in breach of the Act is not able to serve a valid section 21 notice until any prohibited fee has been returned to the tenant or, with the tenant’s consent, credited to their rent account or deposit (if that does not take the deposit above the cap).

Tenant advisers will have updated their section 21 checklists to check compliance with Act and the Court’s N5B Claim Form for seeking possession using the accelerated procedure has now been amended to include a number of questions relating to the Act. There is no doubt that tenant representatives will be analysing payments carefully to check that any fee taken was permitted. If it was not this could provide the tenant with a complete defence to a section 21 possession claim. However, as illustrated above, this will not always be straightforward and will involve checking when the tenancy was granted, the date when the payment was taken (and potentially when the charge was actually incurred) and, if applicable, the date the payment was repaid to the tenant. Some fees will have been taken lawfully at the time, even if they are now prohibited. Landlords/agents and their advisers will also need to ensure that they have scrutinised any payments so that they can demonstrate compliance and, if necessary any prohibited payments are repaid prior to serving a section 21 notice.

More Links, Content, Supporting Documentation & Solutions To Follow October 2020. TLA.

TLA Landlord Survey Q2, 2020 (TLALS)

TLA Landlord Survey Q2, 2020 (TLALS)

Introduction and main findings

  1. The 2019-20 TLA Landlord Survey (TLALS) is a survey of landlords and letting agents who own and/or manage privately rented properties in England.
  2. The aim of the TLALS is to provide understanding of the characteristics and experiences of landlords and how they acquire, let, manage and maintain privately rented accommodation.
  3. Since 2010, the private rented sector has undergone substantial growth and change. The number of households in the sector rose by 25% between 2010-11 and 2018-19, from 3.6 million to 5.5 million households.
  4. The private rented sector is now the second largest tenure in England, and is home to over a fifth of all households.
  5. The private rented sector is characterised by diversity, containing a wide range of different sub-markets, serving a wide range of different types of households across all incomes, including an increasing number of families.
  6. In 2019, 46% of households in the private rented sector included dependent children (2.6 million households, up from 1.1 million in 2010-11).
  7. There are high rates of turnover in the private rented sector, with the number of house moves significantly higher than in the owner occupied and social rented sectors, both within the sector and between it and the other sectors.
  8. Since 2010, there have also been a number of policy changes affecting private landlords. These include tax changes for Buy to Let landlords, changes to the Stamp Duty Land Tax, tightening lending criteria on Buy to Let mortgages and the growing role of the Build to Rent sector.

These changes were made as part of the government’s wider efforts to make the housing market work for everyone and to ensure the housing market delivers the homes the nation needs.

The survey involved agents who let and / or manage property on behalf of landlords. For brevity, the term ‘agent’ is used throughout the report to describe agents who let and / or manage properties.

This report provides an overview of the private landlord population in England.

The first chapter covers the characteristics of landlords, why and how they became a landlord and how they view their current role.

We also include an overview of private rented dwellings and the households living in them, including the types and location of rented homes and the types of tenants. It also explores how landlords and agents set rents and the circumstances around how tenancies end.

Our survey examines landlord and agent attitudes, including the willingness of landlords and agents to let to different types of tenants and views on longer tenancies. It also presents findings on landlord and agent compliance with current legal requirements.

Other chapters provide evidence regarding the likely future of the private rented sector by setting out findings about landlords’ stated future plans, attitudes towards landlord insurance, boiler care issues and other landlord trends and habits – both past, present and in the future.

Full details of the survey sampling, weighting and reporting conventions are in the technical notes at the end of this report.

Briefly, the TLALS is an online survey of almost 8,000 landlord members of The Landlord Association and 550 lettings agents – all of whom are registered with The Landlord Association or partnering without profit or monetary gain.

All statistics were gathered between December 13th 2019 – January 22nd 2020 and reflect results for the period between January 20th 2019 to December 1st 2019.

Main Findings

These correspond to an estimated 1.8 million landlords operating in the private, residential property rental sector.

Most landlords operate as private individuals rather than as part of a company or organisation.

94% of landlords rent property as an individual, 4% as part of a company and 2% as part of some other organisation.

While almost half of landlords own just one property, half of private rented sector tenancies are let by the 17% of landlords with five or more properties.

45% of landlords have just one rental property. This represents 21% of the private rented sector.

A further 38% own between two and four properties (representing 31% of the sector). The remaining 17% of landlords own five or more properties, representing 48% of the private rented sector.

Ignoring the methodological differences, since 2010, the proportion of landlords with just one property has declined from 78% to 45% or from 40% to 21% of the sector. Meanwhile, the proportion of landlords with five or more properties increased from 5% to 17% or from 39% to 48% of the sector.

Landlords are, on average, older and less ethnically diverse than the general population. Most have been landlords for some time.

Over half (59%) of landlords are aged 55 years or older. Not surprisingly, given the older age profile, a third (33%) of landlords are retired. The majority (89%) of landlords are White.

70% of landlords have let property for 6 years or more. The average (mean) length of time that landlords had let property was 11.5 years.

Landlords most commonly reported that they had become landlords because property was preferable to other investments and/or to contribute to their pension.

46% of landlords became a landlord because they preferred property to other investments; 44% did so to contribute to their pension. Only 4% became a landlord to let property as a full-time business.

Although 53% of landlords bought their first rental property with the intention of renting it out, 32% did so to live in themselves.

Landlords who had been letting for longer were more likely to have used a mortgage to fund their first rental property and more likely to currently use a Buy to Let mortgage compared to more recent landlords.

Almost two thirds (63%) of those who had been a landlord for three years or less had used a mortgage to fund their first rental property compared to three quarters of those who had been a landlord for longer (73% of those who had been a landlord for between four and 10 years, and 75% of those a landlord for 11 or more years).

About half (49%) of those who had been a landlord for three years or less had a Buy to Let mortgage to fund their current property/ies.

This increased to 58% of those who had been letting for between four and 10 years, and 54% for those letting for 11 or more years.

Landlords, on average, report a gross rental income of £15,000 per year (before tax and other deductions). For most landlords income from rent makes up two fifths (42%) of their total gross income.

The average (median) gross rental income (before tax and other deductions) is £15,000. Three in five (61%) landlords had gross rental income of less than £20,000, while a further quarter (26%) reported between £20,000 and £49,999.

Thirteen percent reported a gross rental income of £50,000 or more.

Using their annual reported gross income (before tax and other deductions and excluding rental income) and their gross rental income, it was calculated that landlords received 42% of their total gross income from rental property.

Over the next two years, half of landlords plan to keep the number of rental properties the same, with similar proportions planning to increase the number of properties as those planning to decrease or leave the rental business.

53% of landlords planned to keep their number of rental properties the same, with 11% planning to increase the number of properties they own. This compared with 10% of landlords who planned to reduce the number of properties (representing 18% of tenancies) and 5% planning to sell all their rental property and leave the
rental business (representing 5% of tenancies).

Letting practices vary between landlords and agents. For example, agents are more likely than landlords to increase rent for a new tenant and for a tenancy renewal. They are also more likely to require a larger deposit.

50% of agents increased the rent for their last letting to a new tenant compared to 42% of landlords. For their most recent tenancy renewal 70% of landlords kept the rent the same compared to 63% of agents. A third (31%) of agents increased the rent for existing tenants, compared to 22% of landlords.

For their last letting, 61% of agents took a deposit of more than four and up to six weeks’ rent (45% of landlords took a deposit of this size). Almost half (47%) of landlords took a deposit of up four weeks’ rent (compared with 29% of agents).

Meanwhile, landlords are less willing than agents to let to certain groups, including those in receipt of Housing Benefit and Universal Credit, non-UK passport holders and families.

52% of landlords and 37% of agents reported that they would be unwilling to let to tenants in receipt of Housing Benefit. Similar proportions reported that they would be unwilling to let to anyone on Universal Credit (47% and 33% respectively).

The most commonly reported reasons for not letting to this group included the risk of delay in payment or unpaid rent and the risk that benefits would not cover the rent.

A quarter (25%) of landlords and 10% of agents are unwilling to let to non-UK passport holders. Reasons for this were not explored.

18% of landlords and 6% of agents are unwilling to let to families.

Most often this was because their property or properties were unsuitable for families and also because of the greater risk of damage to the property.

Landlords were asked how many rental properties they own in England.

  • In 2019, 45% owned one rental property, representing 21% of tenancies.
  • A further 38% owned between two and four rental properties, representing 31% of tenancies.
  • The remaining 17% of landlords owned five or more properties, representing almost half (48%) of tenancies,
  • The portfolios of individual landlords were considerably smaller than those of companies and organisations.
  • Most individual landlords (85%) owned between one and four properties, with just under half (47%) owning only one
    rental property.
  • The remaining 15% of individual landlords owned five or more
    properties.
  • By comparison, 46% of companies owned between one and four properties, with only 10% owning one rental property.
  • Just over half (54%) owned five or more rental properties, including 14% who owned 25 or more
  • Landlords with a Buy to Let mortgage were more likely than landlords with another kind of loan, or with no debt or borrowing, to own multiple rental properties.
  • About a third (37%) of landlords with a Buy to Let mortgage owned one property, with two thirds (63%) owning two or more properties.
  • Of landlords with another kind of loan, the proportion with one property alone increased to half (51%), while half (49%) owned two or more properties.
  • Among landlords with no debt or borrowing to fund their rental property, more than half (55%) owned one property and less than half (45%) owned two or more properties
  • Landlords who had been letting for longer tended to have larger portfolios. Of landlords with 11 or more years’ experience, 70% had two or more properties, compared with 48% of those who had been letting for four to 10 years and
    22% of those who had been a landlord for three years or less
  • Between 2010 and 2019, there has been a significant decrease in the proportion of landlords with just one property, from 78% to 45%. This decrease may in part be a function of the different methodology, e.g. such landlords may have longstanding tenants.

Ending a Tenancy and Tenant Eviction

  • Three quarters of landlords and agents were willing to offer longer tenancies of more than 12 months.
  • 40% were willing to offer longer tenancies.
  • An additional 38% of landlords and agents were willing to if there was a break clause in place to enable tenants and landlords to break the contract if required.
  • Landlords and agents who reported a tenancy ending within the last two years were asked why this tenancy (or these tenancies) had ended. The findings are reported for both landlords and agents together because agents are likely
    to be responding on behalf of a number of landlords that they represent and it is not appropriate to compare the responses of the two groups.
  • The most common reason, selected by half (50%) of landlords and agents, was that it was the end of the tenancy and the tenant decided not to renew. A quarter (25%) of landlords and agents reported that tenancies ended because the tenant moved out before the end of the tenancy
  • Other reasons for tenancies ending included the landlord or agent asking the tenant to leave (3%), the landlord or agent evicting the tenant (15%)

Eviction Numbers Increasing

Where landlords and agents reported that they had chosen to end a tenancy in the last two years either by asking the tenant to leave, not renewing a tenancy or evicting a tenant, they were asked to select the reasons for this

  • The most common reason for landlords and agents to end tenancies, selected by over half (58%) of landlords and agents, was that the tenant was in arrears.
  • Less than half (45%) of landlords and agents chose to end a tenancy because the property was not cared for.
  • Other reasons for ending the tenancy included to refurbish the property and relet it (18%), to sell the property (10%) and that the tenant had too many complaints about the property (13%)

Landlords and agents were asked what would encourage them to offer longer tenancies.

  • They most commonly reported that they would if it was easier to remove problem tenants (70%).

In most cases, landlords and agents report that it is the tenant’s choice to end a tenancy.

  • 50% of landlords and agents reported that, in the last two years, they had ended at least one tenancy because the tenancy ended and the tenant did not want to renew.
  • A quarter (25%) ended because the tenant had moved out before the tenancy had ended.
  • Meanwhile, 7% of landlords and agents asked the tenant to
    leave, 7% evicted the tenant and 4% decided not to renew.
  • The most common reasons for evicting, asking a tenant to leave or not renewing a tenancy were due to rent arrears (58%) or due to the tenant not caring for the property (45%).
  • In relation to the last tenancy that ended, 60% of landlords and 54% of agents returned the full deposit to the tenant. A quarter (24%) of landlords and 30% of agents returned some of the deposit.
  • Landlords and agents did not return the deposit (either in part or at all) due to damage to the property or contents (65% of landlords and 60% of agents) and to clean the property for the next tenant (65% of landlords and 65% of agents).

Profile of private landlords

This chapter presents findings on the types and characteristics of landlords, their finances, their motivations for becoming a landlord and their perceived role as a landlord. These questions were asked only of landlords and so this chapter does not include agents

Landlord types

  • Landlords were asked how they currently let their property. The majority (94%) let property as an ‘individual or a group of individuals’, with 4% ‘as part of a company’ and the remaining 2% as part of some ‘other’ organisation. (For track, The Landlord Association is not represented as an ‘other’ organisation. We are exempt from the options to avoid confusion when sumissing landlords as individuals when also part of a collective entity)

Landlord population by landlord type

  • Most (83%) tenancies were represented by individual landlords, with companies representing 13% and other organisations 4%,
  • In 2010, 89% of all landlords in England were private individuals, with 5% company landlords and 6% other organisation landlords.
  • Individual landlords represented 71% of all private rented dwellings, with companies representing 15% and other organisations 14%
  • Landlords were asked how many rental properties they own in England. In 2018, 45% owned one rental property, representing 21% of tenancies.
  • A further 38% owned between two and four rental properties, representing 31% of tenancies.
  • The remaining 17% of landlords owned five or more properties, representing almost half (48%) of tenancies
  • The portfolios of individual landlords were considerably smaller than those of companies and organisations. Most individual landlords (85%) owned between one and four properties, with just under half (47%) owning only one
    rental property. The remaining 15% of individual landlords owned five or more properties. By comparison, 46% of companies owned between one and four properties, with only 10% owning one rental property. Just over half (54%)
    owned five or more rental properties, including 14% who owned 25 or more,
  • Landlords with a Buy to Let mortgage were more likely than landlords with another kind of loan, or with no debt or borrowing, to own multiple rental properties. About a third (37%) of landlords with a Buy to Let mortgage owned one property, with two thirds (63%) owning two or more properties. Of landlords with another kind of loan, the proportion with one property alone increased to half (51%), while half (49%) owned two or more properties. Among landlords with no debt or borrowing to fund their rental property, more than half (55%) owned one property and less than half (45%) owned two or more properties
  • Landlords who had been letting for longer tended to have larger portfolios. Of landlords with 11 or more years’ experience, 70% had two or more properties, compared with 48% of those who had been letting for four to 10 years and 22% of those who had been a landlord for three years or less
  • Between 2010 and 2018, there has been a significant decrease in the proportion of landlords with just one property, from 78% to 45%. This decrease may in part be a function of the different methodology, e.g. such landlords may have longstanding tenants for whom they have not taken a
    deposit.

Age, ethnicity and time spent as a landlord

  • Individual landlords were asked questions about their personal characteristics and landlord journey
  • Landlords were, on average (median), 57 years old. This is older than the general population. At the time of the 2011 Census, the median age for the population of England and Wales was 39 years.
  • Over half (59%) of landlords were aged 55 or older, representing 62% of tenancies
  • In 2010, 70% of landlords had been landlords for 10 years or less, representing 48% of tenancies. The difference between 2018 and 2010 suggests that the average length of experience as a landlord has increased since then, but this could reflect changes in methodology

Financing & Buy to Let Mortgages

  • Compared with longer standing landlords, recent landlords were more likely to have bought their first rental property to live in themselves and less likely to have bought it with the intention of letting it. Over a third (37%) of landlords that had been a landlord for three years or less bought their first property to live in themselves, compared with 28% of those who had been a landlord for 11 or more years. On the other hand, half (49%) of those who had been a landlord for three years or less bought their first rental property with the intention of letting it out, compared to two thirds (58%) of those who had been a landlord for 11 or more years
  • Landlords who had bought or built their first rental property were asked about the sources of funding for this purchase or build. Almost three quarters (72%) reported using a mortgage, 37% used personal savings and 8% used an inheritance
  • Recent landlords were less likely to have used a mortgage to fund their first rental property, compared to longer standing landlords. Almost two thirds (63%) of those who had been a landlord for three years or less had used a mortgage. In comparison, around three quarters of those who had been a landlord for longer had used a mortgage (73% of those who had been a landlord between four and 10 years, and 75% of those a landlord for 11 or more years),
  • In 2018, 29% of landlords were employed full-time and 11% part-time. A third (33%) of landlords were retired. Less than a fifth (16%) of landlords were selfemployed (not as landlord), with a further 13% self-employed as a landlord
  • Over half of tenancies were represented either by landlords who were retired (28%) or those self-employed as a landlord (30%)

Property values and borrowing

  • Landlords were asked the approximate value of their total rental property portfolio. The average (median) total market value of landlord rental portfolios was £400,000. Nearly a quarter (23%) of landlords had portfolios they valued at less than £200,000. A further 36% had portfolios they valued from
    £200,000 to £499,999. Nearly a quarter (22%) had a portfolio they valued from £500,000 to £999,999, with the remaining 18% having rental property portfolios valued at £1 million or more
  • The longer the time spent letting, the more likely landlords were to have a higher value portfolio. Of those who had been a landlord for three years or less, only 15% had a portfolio valued at more than £500,000. This rose to 32% of those who had been letting for between four and 10 years and to over
    half (54%) of those letting for more than 10 years
  • The average (mean) estimated value per rental property for all landlords was £261,900 with the average house value £243,000
  • Landlords who reported using borrowing or loans to fund their rental property were also asked the approximate value of such borrowing. The average (median) value of loans or borrowing was £180,000. One in three (29%) landlords using borrowing had loans of less than £100,000, with a further 38% having loans of between £100,000 and £300,000. The remaining third (33%) had loans of £300,000 or more
  • The longer a landlord had been letting the higher the value of their loans or borrowing. Only 3% of landlords who had been letting for three years or less had borrowing of £500,000 or more. This rose to 12% for those who had been letting for between four to 10 years and to 27% for those who had been letting for more than 10 years
  • The median equity or net value of landlord rental portfolios was £220,000, calculated from the median value of landlord rental portfolios minus median value of loans or borrowing.
  • For those who had existing loans or borrowing, the loan to value ratio of the borrowing was calculated using the landlord’s estimate of their portfolio’s market value. The median loan to value ratio for these landlords was 50%.
  • Over a third (34%) of landlords with debt or borrowing on their rental properties had a loan to value ratio of 39% or less, with another third (32%) one of 40 to 59%. A quarter (25%) had a loan to value ratio of between 60 to 79%, with a further 9% having a loan to value ratio of 80% or more. Of these
    landlords, 4% had an estimated loan to value ratio of 100% or more,

Portfolio loan to value ratios for landlords with debt

  • Landlords were asked which, if any, types of loans or borrowing they currently have to fund their rental property. Over half (55%) of landlords had a Buy to Let mortgage, representing 61% of tenancies. More than a third (39%) of landlords had no debt or borrowing, representing 30% of tenancies. Smaller proportions had a commercial loan (4%) or a loan from family or friends (3%),

Extent and type of borrowing for funding of rental property

  • Landlords who had been letting for longer were more likely to have a Buy to Let mortgage. Of landlords who had been a landlord for three or less years, almost half (49%) had a Buy to Let mortgage. This increased to 58% of those who had been letting for between four and 10 years, and 54% for those letting for 11 or more years
  • Of recent landlords (three years or less), 43% had no loans or borrowing to fund their rental property, compared to 34% for those who had been a landlord for between four and 10 years and 42% for those landlords who had been letting for more than 10 years

Type of rental property currently let or managed by landlords and agents

  • Landlords with larger portfolios are more likely to be letting a wider range of property types. As such, the proportion of landlords with each property type increased with portfolio size
  • For instance, the most common type of property for landlords with portfolios of all sizes were terraced houses. A third (32%) of landlords with one property had a terraced house, while half (48%) of those with between two and four properties had at least one, as did 70% of those with five or more properties in their portfolio. However, the distribution of types of properties was similar for landlords with different sized portfolios

Gas and Boiler Issues in let property

  • Landlords reported a rise (10%) from 2018 in boiler repairs with 12% of property requiring a repair on a gas boiler within their let properties during 2019. Furthermore, an increase of 2% from 2018-19 required a replacement gas boiler (6%)

Types of Gas Boiler by replacement type

  • Types of gas boilers by replacement type
    • Combi – 44%
    • Regular – 40%
    • System – 16%

By regional breakdown

  • The most boiler repairs were needed in London with 6.08% of boilers estimated to have broken down during this period. This was closely followed by the West Midlands at 6.04% and the North East at 5.59%.
  • Boilers are least likely to break down in Yorkshire with 4.27%, Scotland at 4.38% and the North West at 4.79%.
  • These results, at an average of 5.1% nationally, suggests 30,000+ boiler repairs were undertaken on property within portlofios managed by landlords under the guidance of The Landlord Association

Landlord Insurance

  • up 12% on 2018, 79% of landlords reported having landlord insurance cover for their properties, by type popularity
    • Buildings Insurance
    • Contents Insurance
    • Boiler Care Cover
    • Public Liability Insurance
    • Landlord Emergency Cover
    • Rent Guarantee Insurance
    • Unoccupied Property
  • A further 18% of all landlords indicated that they were either thinking of or actively seeking to insure their properties currently uninsured, up 7% on the previous year
  • Landlords with a single property were less likely to have a insurance policy (68%) than those with a portfolio of two properties or more (87%)

Boiler Cover Insurance

22% of landlords indicated that they have boiler care cover (up 12% on 2018) suggesting that over 130,000 property are insured with some kind of cover to protect their boilers for repair and replacement

of those without boiler care cover, 15% suggested they were either thinking of getting cover or were actively seeking to get cover (90,000 properties).

Of the reasons given for not having boiler cover (1) Not enough time (2) too expensive (3) not important (4) Did not renew previous policy (5) portfolio cover options minimal (6) No gas in property (18%).

© TLA copyright, 2020. 

This survey may be republished in part or full without permission. If you require any further information regarding the collation of this survey or indeed any of the information and statistics included please email dean@landlordexpert.co.uk.

This document/publication is also available on our website at www.landlordexpert.co.uk. All rights reserved by The Landlord Association.

Coronavirus Act 2020 – How It Effects Landlords & Tenants

Coronavirus Act 2020 – How It Effects Landlords & Tenants

This note sets out how the Coronavirus Act 2020 (“the Act”) affects both business and residential tenancies taking into account the Governmental advisory guidance to help understand the implications of the Act.

As the situation is subject to change, the Government urges all landlords and tenants to abide by the latest Government guidance on COVID-19, which can be found here.

Business Tenancies

Landlords cannot evict business tenants on the grounds of non-payment of rent whilst the Coronavirus emergency continues. This currently applies from 26 March to 30 June 2020 (“the relevant period”) unless subsequently extended.

Forfeiture for non-payment of rent

During the relevant period the landlord cannot enforce a right of re-entry for non-payment of rent (the definition of rent includes service charge and insurance premium), whether by peaceable re-entry or in court proceedings. To protect the landlord’s position, the right of re-entry can only be waived during the relevant period by an express waiver in writing. These provisions do not apply to any other type of breach of covenant.

Where forfeiture proceedings for non-payment of rent are already on foot, the court cannot make an order for possession which expires before the end of the relevant period. In some cases the court will have made an order for possession which only takes effect if the tenant fails to do something (e.g. pay the arrears or instalments) by a certain date. In the High Court, if the tenant applies to vary the order the court must ensure that the tenant does not have to give possession before the end of the relevant period. In the County Court, the period during which the tenant has to pay cannot be before the last day of the relevant period (as in force at the date of the order). For existing orders, the period within which the tenant must pay the arrears is automatically extended to the end of the relevant period.

Opposing the grant of a new tenancy on the grounds of persistent delay in paying rent

Where a landlord opposes the grant of a new tenancy on the ground of persistent delay in paying rent, any failure to pay rent during the relevant period is to be disregarded.

Residential Tenancies

The Government has brought in several restrictions in relation to residential possession. Firstly, the Act lengthens the notice period required during the relevant period. For residential tenancies, the “relevant period” set out in the Act is from 26 March to 30 September 2020; unless subsequently extended.

Section 8 Notices

Possession proceedings under section 8 of the Housing Act 1988 have always required the service of a notice of intention to bring proceedings for possession. The minimum period of the notice depended on the particular ground for possession relied on – from immediately, in the case of an occupier who has committed an indictable offence, to two months in the case of a former owner-occupier who wants his home back. During the relevant period, all notice periods are extended to three months. The court retains its power to dispense with service of a notice or to abridge the time.

Section 21 Notices

The Act extends the minimum notice period under section 21 of the Housing Act 1988 (no fault eviction) from two months to three months.

Other Private Sector Tenancies

No amendments have been made to the law affecting private sector tenancies which do not fall within the Rent Acts or the Housing Act – essentially tenancies at a very low rent (less than £1,000 pa in Greater London, £250 elsewhere) or a very high rent (in excess of £100,000 pa).

Possession claims suspended

From 27 March 2020 for a period of 90 days (i.e. up to 25 June 2020) there is a suspension of housing possession cases in the Court. This affects new or existing claims, so effectively they cannot be progressed during this period. This is in line with current public health advice to stop all non-essential movement. The Government’s strong advice to landlords is not to commence new notices seeking possession during the current time without a “very good reason” for doing so.

Maintenance and safety

Landlords should still carry out essential and urgent work to ensure that rented properties are safe. Examples given in the Governmental guidance include testing the fire alarm, roof repairs where there is a leak, boiler and plumbing repairs, broken white goods and security problems e.g. a broken window or door. Landlords should take a “pragmatic, common sense approach” to resolving issues. Where COVID-19 restrictions prevent landlords from meeting routine obligations they should not be unfairly penalised. However, the guidance specifically refers to landlords making every effort to abide by existing gas safety and electrical safety regulations (the latter comes into effect for new tenancies from 1 July 2020). Landlords must demonstrate that they have taken all reasonable steps to comply with the law. If landlords are not able to engage a contractor or gain access to the property due to COVID-19 restrictions they should document their attempts and any responses. The relevant legislation already contains provisions where the landlord will not have breached his duty if he has taken all reasonable steps.

General governmental guidance

The general message is that the landlord and tenant relationship should continue as normal as far as is possible i.e. the tenant should continue to pay rent and adhere to all other terms in the tenancy agreement. Landlords should continue to comply with their obligations as well. Where the tenant is unable to pay rent due to Coronavirus related difficulties, the tenant should speak to their landlord at the earliest opportunity. Landlords are requested to be flexible and offer support and understanding to their tenants as part of the national effort during this national emergency. Both parties are encouraged to agree a sensible way forward including for example, to agree a lower rent and a payment plan going forward.

Where there are financial difficulties for the landlord where the tenant is not able to pay rent due to Coronavirus related difficulties, mortgage lenders have agreed to offer payment holidays of up to three months including for buy-to-let mortgages.

The future

There may well be further changes depending on how the situation develops. The Government has the power to alter the notice period required by substituting a period of up to six months. They may well also extend the suspension period on possession claims.

Rent and coronavirus: What comes next for UK landlords and tenants affected by Covid-19?

The coronavirus crisis is now fast-approaching its fourth month and we’re only just starting to see the economic impact. The spectre of a severe recession, the likes of which, in the words of Chancellor Rishi Sunak, “we have not seen” looms large. His words are unambiguous: we are awaiting the biggest economic shock in recent history.

There is rightful concern from one demographic in particular: private renters. This is a group thought to contain about 20 million people who rely on private landlords to keep a roof over their heads. It has grown rapidly over the last decade or so because getting on the housing ladder has become increasingly unaffordable while social housing has been in increasingly short supply.

This pandemic has exposed the precariousness of Britain’s private rented sector for what it is: a national emergency. Before Covid-19 disrupted life as we knew it, renters were already worse off than homeowners, spending a higher proportion of their earnings on housing. Sixty three per cent of them had no savings and almost half of working renters were just one paycheck away from losing their home. Think of them as the “squeezed middle” Ed Miliband once tried to champion – they were already stretching themselves to cover the most essential cost of all: housing.

The Government clocked this would be a huge problem early on. In late March, they announced a three-month suspension of evictions and the restoration of Local Housing Allowance to the lowest third of market rents which renters could access by applying for Universal Credit. These measures went hand in hand with the Job Retention Scheme which, they hoped, would tide anyone whose job was at risk over.

Now, as furloughs are extended, business closures are prolonged and redundancies registered, the housing charity Shelter estimates that around 1.7 million renters expect to lose their job. Early tremors revealed by the latest Office for National Statistics employment data – a 69 per cent increase in people applying to Universal Credit – point to a storm ahead. Citizens Advice estimates that 2.6m renters are behind on rent or expect to be as a result of this pandemic.

As we approach the end of that three-month period, questions are being asked about what the plan is for renters now. Will the evictions suspension be extended or will we, as the London Councils Group has warned, see an “avalanche” of them when it is lifted? Will the increase to Local Housing Allowance continue?

Left-leaning social media accounts are awash with calls for a “rent strike”. Labour’s shadow housing secretary, Thangam Debbonaire, has published a five-point plan for renters which includes protecting them from bankruptcy as a result of any rent arrears. Meanwhile, Housing Secretary Robert Jenrick has said the Government is still “thinking carefully” about what to do next and “developing a much more credible plan to protect renters and to help to shield them through this crisis.”

So where does that leave private renters who are, completely understandably, very worried?

What could happen with evictions and rent arrears?

As things stand, all evictions proceedings are suspended. This was initially done for a 90-day period and takes us up until the end of June. Last week Jenrick told Parliament a decision would be made on the future of the ban shortly before then. One of the suggestions in Labour’s five-point plan is extending it for six months.

Giles Peaker, an expert housing solicitor and partner at Anthony Gold explains: “The Government has increased the periods for notices seeking possession, and the courts have currently put all possession claims on hold until 25 June. But unless this is extended, or other measures are brought in by the Government, there is a real risk that people will face possession claims for rent arrears in a month or two, or possession claims after a section 21 notice. Tenants (and their guarantors) may also face money claims for arrears.”

One of the issues on the horizon, he adds, is that legally, as things stand, having been impacted by the crisis is not a defence for not paying rent for anyone challenging an eviction order in court.

It’s worth noting that, before Covid-19 took over every aspect of public life, we were expecting legislation to ban Section 21 evictions (also known as unfair or revenge evictions). It’s likely this will return to Parliament at some point. However, as Peaker notes, this wouldn’t protect those who haven’t been able to pay their rent.

What help can I get with rent because of coronavirus?

Back in March the Government announced that landlords could take a “mortgage holiday” if their tenants were unable to pay rent and encouraged them to be “compassionate” in such situations. Some didn’t feel this went far enough.

The Government also increased Local Housing Allowance (LHA) so that it covers the lowest third of market rents. This can be accessed by renters who find themselves unemployed because of this crisis via Universal Credit. However, not everyone will be eligible for this.

There is good news, though. When asked by i whether this change to LHA was permanent a spokesperson for the Treasury said: “This will apply for the 2020-21 financial year. There are no plans to reverse the increase.”

However, rents fluctuate. So, while the increase to LHA may be here to stay for now, if we saw rents rise, this wouldn’t stay in line with them and would continue to only cover the lowest third of market rents.

What ideas are being proposed to help renters pay their rent?

Labour’s plan to help renters was criticised by some because it proposed giving those who fall behind on rent a two-year period to pay back rent arrears which would leave them indebted to their landlord.

In Spain, a low-interest loan system has been introduced to help renters honour their payments. When Labour MP Clive Betts asked Jenrick if we would consider something similar, he didn’t dismiss the idea.

However, this would likely attract similar criticism to that thrown at Labour’s plan. Renters are already worse off than homeowners and saddling them with debt during an economic crisis will undoubtedly harm their prospects moving forward.

Caitlin Wilkinson, Policy Manager at Generation Rent, tells i that the rent strike being encouraged on social media by some is not the answer. “Suspending rents temporarily could put renters at risk of debt once the freeze is lifted,” she explains. “If we had a functional welfare system this wouldn’t be an issue, so fixing that should be our priority. Generation Rent is calling on the Government to remove the benefit caps, increase local housing allowance, and expand eligibility.”

So, what’s the alternative? Increasing the generosity of the housing benefits would be one place to start – this is something the Joseph Rowntree Foundation has already called for. JRF told i in April that the current increase to covering the lowest third of market rents just doesn’t go far enough and won’t break the fall of those who were already over-stretched. Shelter is calling for it to be increased further so that it covers “average rents” in any given area.

It’s really important that the Government comes up with an adequate plan to support renters who suffer financially in the coming months. As Peaker warns, a tenant not paying rent, regardless of the reason, could have serious implications. A tenancy agreement is a legal contract which means that “tenants are still obliged under their tenancy agreement to pay the rent, no matter what has changed in their circumstances.”

The Government, Peaker notes, have so far stopped short of telling landlords what to do. “While some landlords have agreed to waive rent, or reduce it, or for repayment plans in the future, there is currently no obligation on them to do this.”

Because so many people now rely on the private rented sector, an increase in the benefits available to renters is, in effect, going to result in a mammoth public bailout of private landlords on a scale never seen before. Building the social housing we’ve lost through Right to Buy is an obvious way out of this long-term but, in the short-term, renters can be reassured that the Local Housing Allowance increase isn’t going anywhere and wait for the Government’s next announcement.

Government announces mass testing plan for Covid-19 ‘Exit Strategy’

Ministers have finally revealed a long-demanded “exit strategy” from the coronavirus lockdown with a plan to recruit an army of 18,000 people to trace and isolate infected people – allowing restrictions to be eased, they hope.

Five weeks after the World Health Organisation urged all nations to “test, test, test” – a plea rejected by the UK at the time – it was announced that the mass contact tracing programme would begin “in a matter of weeks”.

Ministers have finally revealed a long-demanded “exit strategy” from the coronavirus lockdown with a plan to recruit an army of 18,000 people to trace and isolate infected people – allowing restrictions to be eased, they hope.

Five weeks after the World Health Organisation urged all nations to “test, test, test” – a plea rejected by the UK at the time – it was announced that the mass contact tracing programme would begin “in a matter of weeks”.

The move was greeted with relief by Jeremy Hunt, the former health secretary and a leading voice demanding mass testing in the community, rather than simply in hospitals and of NHS and care workers.

* Essential workers, including supermarket workers, bus drivers and teachers, and their household members were told that, from tomorrow, they will be able book a test on the gov.uk website – potentially benefiting 10 million staff if the rest of the UK follows England.

* Continuing problems with the current testing programme were laid bare – with only 23,560 carried out on Wednesday, less than half the capacity of 51,000.

* London was described as “two or three weeks” ahead of other parts of the country – with Manchester and Liverpool now the focus of the pandemic, according to a Health Service Journal analysis.

* “New and better” blood tests were promised – not requiring the chemical reagents that have been in short supply.

He sought to deflect criticism of delay, arguing he had had to wait until the pandemic had peaked, saying: “Critically, test, track and trace works more effectively when the rate of new cases is lower.

“So, the lower the rate of new cases, the more effectively you can keep it down using test, track and trace rather than having to use heavier social-distancing measures.”

Jonathan Ashworth, Labour’s shadow health secretary, criticised “confusion” at the heart of government, pointing out the deputy chief medical officer, Jenny Harries, had dismissed the idea only days ago.

And he said Mr Hancock had to be held to his original pledge, saying: “We were promised 100,000 tests a day by the end of the month. Not testing capacity at 100,000.

“We’re still not carrying out the numbers of tests we need to. In particular we should be doing so much more to test care workers. They shouldn’t have to travel miles for a test.

Property market open after lockdown measures lifted

As of today (Wednesday 13th May 2020) the property market has been given the green light to open for business again by the government. This means buyers and sellers are able to move home now which is important for those who are already in the process of either selling or buying.

Viewings are allowed to take place again as long as they are conducted in a safe manner and keeping to the social distancing 2m rule.

For those who wish to sell their property you are now oermitted to visit your property for valuation and marketing, whilst doing so keeping to the social distancing 2m rule. There are further safety measures such as gloves, masks and hand sanitiser that should be worn by all visiting parties.