Residential tenants – Is rent still payable during the COVID-19 pandemic?
So in short, the answer is yes - rent must still be paid. The Coronavirus Act 2020 protects residential and social tenants from any ongoing possession proceedings and any new claims for possession for a period of 90 days from 27 March 2020. Both landlords and tenants should be aware that a landlord is not precluded from serving a Section 8 Notice on a tenant, on the rent arrears ground, but that the notice period has been extended to a period of 90 days. Any further legal action to recover possession of the property cannot be taken by a landlord until this period has expired.
Some landlords whose properties are mortgaged may be able to obtain a 3 month mortgage payment holiday form their lender BUT tenants should note that a landlord does not have to pass any kind of payment holiday onto them.
If a tenant is experiencing financial difficulties they should discuss this with their landlord or landlord’s property agent as soon as possible so that the possibility of establishing an affordable repayment plan for any rent arrears can be discussed.
We are seeing agreements being reached, for example, for payment of half the rent for a 3 month period with the remaining half to be paid over a further 3 – 9 months or a reduced rent to be paid for a 3 month period only or even simple agreement not to enforce or claim arrears to a particular amount. If landlords and tenants do reach an agreement they should make sure that both parties understand what is being agreed and record it in writing. Legal advice needs to be taken on agreements that reduce the rent with no agreement to repay as this can alter the tenancy agreement for the future.