Repeated last minute extensions to the evictions ban must be replaced by a coherent exit plan to help the private rented sector emerge from lockdown, the Housing Communities and Local Government committee has said.
In a report published today (March 31) the committee said the sector needed a roadmap out of lockdown to avoid a “debt crisis”.
Research from Citizens Advice in November found half a million private renters were behind on their rent, with an estimated £360m owed across the UK.
According to the committee, the government will need to establish a financial support system for renters who have accumulated significant rent arrears during the pandemic.
It suggested helping tenants pay rent arrears as the “simplest and most straightforward” way to avoid evictions and help landlords receive income, with the potential cost of up to £300m.
Clive Betts, chair of the Housing, Communities and Local Government committee, said: “The ongoing crisis of rent arrears in the private rented sector is deeply concerning. The economic consequences of the pandemic could be long-lasting and become even more severe.
“The ban on evictions has ensured that people remain in their homes for now, but the debt will continue to increase. Landlords, many of whom only own one or two properties, will also be struggling with a loss of income.
“The government will have to find a solution that is workable for tenants and fair for landlords. The gravity of the situation means it should be treated just the same as other sectors of the economy and society that have a clear roadmap out of lockdown.
“Helping tenants pay their rent arrears would come at a cost, but would ultimately prevent significant expenditure on homelessness assistance further down the line.”
The government extended the bailiff-enforced eviction ban this month to May 31 to protect residential tenants amid the pandemic.
Ben Beadle, chief executive of the National Residential Landlords Association, said: “We welcome today’s report which calls for a proper exit plan for the private rented sector from current restrictions.
“At the heart of that plan needs to be action to tackle rent debts built as a result of the pandemic. The committee is right to express disappointment at the lack of a clear strategy from the government to deal with this pressing issue.
“We wholeheartedly support the committee’s call for action to support tenants to repay rent arrears to be a top priority, including consideration of making payments direct to landlords. As the report notes, this would be the best way to sustain tenancies and help landlords receive income.”
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