Hope you are keeping safe and well during these highly unusual times. As you are aware the GPL team are working remotely due to the lockdown, but still contactable via email. We did prepare for working from home and are having regular video conference calls with each other as well as still having staff training sessions via webinar with various companies.
I’ve had a few questions about the current market and I can only answer this as I see it today , especially as it is consistently changing.
In a previous email I mentioned how the private rented tenancy affected the tenants that we have. The PRT came into effect 1st December 2017, but we did not really see the effects of it until 2019. At which time students had been giving notice at the end of the academic year(March) which meant that properties that were typically student properties were being taken by professionals who were not on the housing market as owners .
This drastically altered our student:full time employed tenant ratio and although we have had students give 28 days notice due to the university’s closing and workers who are in furlough requesting a rent deferral period – as yet we haven’t had the mass panic from tenants to make alterations to the tenancy agreement that other agents have reported. I am not naive and I am aware that can change very quickly as this whole situation has been life changing at a dramatic pace.
We have been advising all tenants of the information and support available to them as and when the information becomes available or updates such as the well-publicised coronavirus job retention scheme and the newly announced self-employed income support scheme.
The Scottish Government have also published guidance for landlords and letting agents which can be found here.
COVID-19 financial assistance for landlords
The Scottish Government on the 1st April 2020 announced that they will be offering financial assistance to landlords who suffer a loss of income as a result of the coronavirus crisis. The interest free loans should be available by the end of April.
Commenting on the announcement regarding support for landlords via a new interest free loan fund, John Blackwood, Scottish Association of Landlords chief executive, said: “We are pleased the Scottish Government and other parties have listened to our concerns and welcome this first step in providing support for a sector which has fallen between the cracks of previous announcements.”
“This announcement will provide some reassurance for our members, who are providers of essential housing and many of whom rely on income from rented properties and operate the same way as other small businesses, but this needs to go a lot further. For example, a lot of our members are retired and reliant on rental income so unless that income is guaranteed, these older people will suffer real hardship.”
“It is also important that landlords and tenants work together throughout this crisis to prevent the threat of later eviction and rent arrears. We do, however, remain convinced that in cases where anti-social behaviour can be conclusively demonstrated, action must be possible so landlords can fulfil our responsibilities to the wider community. We would welcome further clarification on this point in the future.”
The minister’s words were:
“The Scottish Government will establish a fund that eligible private landlords will be able to apply to if they experience difficulty securing rent as a result of the Covid-19 crisis. They will be offered an interest-free loan with deferred payments. The intention is to take the pressure off landlords, in the short-term, if their tenants are having difficulty making rent payments. We expect to have that fund in place by the end of April, at the latest.”
Later he said: “As I said earlier, we are looking at a landlord loan fund, which we will make available as soon as possible and for as long as it is needed. We hope that we can have all that in place by the end of April at the latest, as I said in my opening remarks. We are developing the detailed criteria around that. We will make such a loan available for as long as possible, for as long as it is needed. We envisage that that would be up to a year, and we will backdate it to 1 March.”
COVID-19 changes to eviction procedures
In response to the coronavirus crisis, Scottish Ministers have approved legislation which makes changes to the eviction procedure for tenancies in the private and social rented sector. Initially these changes will apply from when the legislation receives Royal Assent (expected to be early next week) until 30 September 2020 but there is provision in the legislation for the end date to be changed.
Please note that the changes do not apply to any evictions where the landlord served notice on the tenant before the date the legislation receives Royal Assent.
During the period detailed above all evictions will be discretionary, which means that if the tenant doesn’t voluntarily vacate and the landlord has to apply for an eviction order at the tribunal, the tribunal may decide to exercise a reasonableness test in deciding whether to evict the tenant or not. In simple terms, this means that the tribunal will decide based on the circumstances of the case whether the tenant’s need/right to occupy the property is outweighed by the landlord’s need/right to repossess the property.
The legislation also makes changes to the notice period that the landlord is required to give the tenant. The notice period depends on the type of tenancy and the eviction ground being used.
The Housing and Property Chamber of the First-tier Tribunal that deals with eviction cases, will not be hearing cases until at least 28 May but this could be much longer.
Which work activities are “absolutely necessary”?
At present the UK government advice is that we should all stay at home and only leave home for work if it is absolutely necessary.
- Check ins where the incoming tenant is not able to postpone the move in date, for example because otherwise they would have nowhere to live.
- Emergency maintenance work e.g. heating/hot water repairs, water leaks
- Move outs to check the property is safe and secure – these should be done without the tenant being present and to reduce the risk of virus spread from surfaces we recommend doing them 72 hours after the tenant has moved out.
In most cases other activities are unlikely to be considered to be absolutely necessary. We have been advised property inspections should not be carried out at present. We are advertising available property with video walk through where possible but viewings taking place during lockdown is being worked out.
The Scottish Government advises in its guidance that landlords and letting agents should postpone routine safety certification requirements during the crisis and carry them out as soon as possible after it is over.
This was touched on in previous emails . For further details on what is proposed, see the Scottish Association of Landlords news article here.
Managing rent arrears during COVID-19
Under the terms of the tenancy agreement the rent is still due as normal unless the landlord agrees to a rent reduction or for tenants to pay what is due over a longer period. For guidance on how to deal with rent arrears that arise due to COVID-19 including sources of financial help for tenants please click here.
For guidance on mortgage holidays holidays click here
Take care, stay safe and we are here if you have any questions or would like further information on any of the topics raised in our emails.
I would ask if you do reply to this email, could you add the property or your surname to the subject header which will then allow the system to allocate the message.
Have a lovely weekend
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