Buy-to-letJun 8 2020

Warning sounded on effects of eviction ban on housing market

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Warning sounded on effects of eviction ban on housing market

The government's decision to extend the evictions ban for landlords until August could “cripple” the rental market, the National Residential Landlords Association (NRLA) has warned.

According to the NRLA landlords have expressed “disappointment” at the decision to extend the ban, which will serve as a “further impetus” to landlords leaving the market with confidence at an “all-time low”.

The government announced the extension of the ban to August 23 last week, taking the moratorium on evictions of tenants in England and Wales to a total of five months. The extension applies to homeowners, commercial and leasehold.

Ben Beadle, chief executive of the NRLA, said: “This decision means that some landlords will now be facing five months without receiving any rent as they can take no action against tenants who were not paying before the lockdown started”.

Mr Beadle warned the extension would cause “exceptional hardship for a number of landlords, including many who depend on their rental income to live, for which there is no assistance.”

Mr Beadle said landlords had “every sympathy with tenants who face genuine difficulties because of a loss of income due to the coronavirus crisis” and that nearly all landlords were working with tenants who were struggling to keep them in their home, according to a recent NRLA survey.

Mr Beadle added: “It is important that the government sets out its plans for the market at the end of this one-time extension. A failure to do so will cause serious damage to the private rented sector as a whole.

“It will ultimately be tenants who suffer as they will find it increasingly difficult to find affordable housing if landlords do not have the confidence that they will get their properties back swiftly in legitimate circumstances.” 

The initial ban on evictions was announced on March 18, under which landlords could not start proceedings to evict tenants for at least three months.

Last month research from Citizens Advice showed that 2.6m private renters were at risk of eviction and possible homelessness when the government’s stay on evictions of residential tenants was originally expected to end on June 25.

The government said while it is taking “unprecedented action to protect tenants and landlords during these times, the ultimate ambition is to transition out of these measures at the end of August to allow the [housing] market to operate while ensuring people have appropriate access to justice”.

Where tenants do experience financial difficulties due to coronavirus, the government is expecting landlords and tenants to “work together and exhaust all possible options – such as flexible payment plans which take into account a tenant’s individual circumstances – to ensure cases only end up in court as an absolute last resort”.