Over the past couple of weeks there has been uncertainty over the government’s proposals to halt residential possession proceedings during the current coronavirus pandemic.
The government initially announced a 3 month moratorium on such claims being issued to prevent tenants from being evicted, particularly where they lose income and are unable to meet rental payments as a result of the outbreak. Under these proposals private and social housing landlords would be prevented from evicting tenants during this crisis and landlords, at risk of defaulting on mortgage payments due to the lack of rental income, would be given a 3 month mortgage break. However clarity on the government’s position has now been provided by the enactment of the Coronavirus Act 2020 which took effect from 26th March 2020.
What changes has the government made to residential possession proceedings?
Going forward a Section 21 Notice (no fault Notice) served on tenants to bring an Assured Shorthold Tenancy in England and Wales to an end must give tenants a minimum of 3 months, instead of the standard 2 months, to give up possession of a property. Similarly a Section 8 Notice (fault-based Notice) must give tenants at least 3 months to remedy a breach of the tenancy agreement, instead of the standard 2 week notice period (particularly for non-payment of rent).
These notice periods for Section 21 and Section 8 Notices take effect from 26th March 2020 until 30th September 2020 where after we would expect to either revert to the previous position on notice periods or wait on further guidance from Parliament.
The following types of tenancies (which are less common these days) will also require a 3 month notice period before proceedings can be issued until 30th September 2020:
- Protected and Statutory Tenancies under the Rent Act 1977
- Secured Tenancies and Flexible Tenancies under the Housing Act 1985
- Assured Tenancies under the Housing Act 1988
- Introductory Tenancies under the Housing Act 1996
- Demoted Tenancies under the Housing Act 1996
Essentially, the only change to Assured Shorthold Tenancy possession proceedings brought in by the Act is a variation of the notice period. Therefore on expiry of such Notices, if tenants do not vacate their premises landlords will be permitted to issue possession proceedings in the usual way. The Act does not prohibit eviction, which was the expectation from the government’s initial proposals. Nonetheless, from today, 27th March 2020 all new possession claims will be halted for a 90 day period thereby affording tenants protection from eviction. This means that new claims will not be progressed for 90 days. This period can be extended further should the need arise.
What about possession proceedings in the pipeline?
The Act does not have retrospective effect. As such we expect that courts will deal with possession proceedings in the usual manner. However the government’s 90 day halt to new claims applies equally to claims that have already been issued. This means that from today, 27th March 2020, such claims will not be progressed for 90 days. Again, this period can be extended further at the discretion of relevant authorities. . We can expect there to be delays in courts issuing directions. There will undoubtedly also be delays in arranging hearings due to the coronavirus pandemic; however courts are considering alternatives to in-person hearings (such as telephone trials) to ensure access to justice and a fair trial for all parties.
I served a Section 8 and/or a Section 21 Notice prior to this Act. Can I go ahead and issue proceedings?
Yes. The new notice requirements only apply to Notices served from 26th March 2020. As such once a valid pre-26th March 2020 Notice expires and your tenants have neither vacated the property nor remedied the breach, you can commence possession proceedings in the usual way. However please note that your matter will not be progressed for a minimum of 90 days.
Do I get a mortgage break if I am unable to meet my monthly payments due to lack of income during the coronavirus pandemic?
The Act makes no mention of a mortgage break during the coronavirus pandemic and we wait to see whether Parliament will pass legislation in this regard. In the interim we recommend speaking to your lender or mortgage broker to see what arrangements they may be looking to put in place during this period.
If you would like to discuss your options for regaining possession of your property subject to an Assured Shorthold Tenancy, please contact Will Oakes – 01206 239 764.