Welcome to another week of news under the lockdown.

Fears about rent

There is a lot of concern about tenants in financial problems unable to pay their rent.  Research carried out by Shelter indicates that one in five private renters fear they may lose their jobs due to the Coronavirus.

If this happened they would be unable to afford their rent and would, therefore, risk being evicted after the court’s eviction suspension is ended.

Polly Neate, chief executive of Shelter, said:

The government has rightly suspended evictions until June, so no one has to face homelessness in the middle of this pandemic. But millions of renters will be in dire straits further down the line without more government support.

As renters lose their jobs and see their incomes hit, many will have to rely on the welfare safety net for the first time. Our services are already hearing from families in homes they could comfortably afford under normal circumstances, who are now in serious financial difficulty.

We’re facing an onslaught of people suddenly unable to afford their rent, at a time when people need to stay put and cannot safely move to a cheaper home.

The charity says that the rent element of benefit is still too low to cover most rents and is calling for this to be increased. Despite the recent increase in Local Housing Allowance  Shelter said families in a two-bedroom home could still face a shortfall of up to £1,227 a month in London.

Incidentally, tenants in need of advice will find a very useful help page on the Shelter website here.

Angry Students

Students are angry that they are being expected to pay for empty accommodation when there is no point in them returning for the summer term when their college and universities have stopped classes and moved training online.

For example, Eva Crossan Jory, NUS vice-president, says in the exceptional circumstances of the pandemic there is a “moral duty” on housing firms to give the “option of a no-penalty early release from their contracts”.

There is also an online petition demanding that tenants be let off rent.

There seems to be a mixed picture across the country with some private landlords and universities allowing tenants to end contracts early and others, pointing out that students are still receiving loans, expecting to be paid.

Although many students have been able to go home, hundreds of others, particularly international students from countries such as China, Japan, Pakistan, India and the US, are unable to return and are trapped on near-deserted campuses where facilities and services have closed.  Many of these have signed up to a rent strike protest.

For example, Jamsheed Cooper, a 27-year-old masters student, who is stranded in his £650-a-month student accommodation on the Sussex University campus, unable to get home to Dubai.

I’ve decided to withhold my rent. We can’t leave even if we wanted to. Almost all the campus services are absolutely closed. What are we paying for? The cleaners are not even coming. It’s a ghost town right now.

Councils criticised for starting new licensing schemes

It was believed that Councils would defer the start of new licensing schemes, and, for example, the NRLA, the trade group Safeagent and London Property Licensing have been calling for this.  However, two Councils are pressing ahead anyway.

• Waltham Forest borough council has pressed ahead with their borough-wide additional licensing scheme   Find out more here.
• Coventry Council intends to bring in a licensing scheme from May 4.

The NRLA has written to Croydon asking them to defer their scheme.  The NRLA’s policy director Chris Norris says:

The guidelines are there to protect tenants and landlords from unnecessary contact. Where a licensing scheme is introduced, landlords have to go into their properties to check that they meet the licensing obligation and maybe need to carry out non-essential works. This exposes them and the tenants to an enhanced risk of contagion.

Several local authorities have done the right thing and paused the introduction of new licensing schemes in response to the crisis including Luton and Newcastle and we are asking Coventry to do the same. It would be thoroughly irresponsible of the Council to ignore the guidelines and go ahead with their plans.

Business interruption insurance lets agents down

I mentioned in a previous newshound that some insurers were refusing to pay out on rent guarantee insurance.  Now it seems as if some insurers are refusing to pay out on business interruption insurance.

The Negotiator has a story here from Mark Rath of Mark Rath Residential in Wokingham, Surrey who told them he took out a Hiscox policy via Propertymark-approved broker Gallagher to insure them against the lost revenue that an event like the Coronavirus crisis would cause, saying

The policy says we are covered for any notifiable diseases, which Covid-19 is of course.  We started to make a claim but received a reply from Hiscox saying that it only covered for a notifiable disease that spread inside our office, not outside – but obviously we are outside the office all the time usually doing viewings and since the lockdown we can’t do that.

Following on from this the Negotiator reports that

City watchdog the Financial Conduct Authority has written to the chief executives of the UK’s insurers including Hiscox to put pressure on them to settle claims faster and more fairly and make interim payments if there are reasonable grounds to partially pay out on a claim.

The FCA has taken the step after thousands of small business owners, like Mark Rath who we highlighted yesterday, have complained loudly that policies that they thought would help them recoup revenue lost during the crisis have proved worthless.

The Raths were sold their policy apparently by  Gallagher, who are Propertymark’s approved broker for business interruption insurance.

Snippets

• Estate agencies, cafes and restaurants should be first to re-open, says report
• Agency waives fees for landlords letting empty properties to NHS workers
• New AST template and guidance specifically for longer-term lets
• Hamilton Fraser announce the launch of new deposit replacement scheme, Ome
• Council puts pressure on landlords to pay licensing fees despite Ministers’ advice to ‘go easy’
• University of Central Lancashire waives rents for 1,700 students and urges private landlords to follow suit

Newsround will be back next week.