12 out of 13 tenants asked for “Rent-Free Holiday”?

by Readers Question

9:10 AM, 14th April 2020
About 4 months ago

12 out of 13 tenants asked for “Rent-Free Holiday”?

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12 out of 13 tenants asked for “Rent-Free Holiday”?

I have 13 single tenancies (family homes) in Reading. All houses are rented to Eastern European families. All tenants except 1 (in total 12 tenancies) contacted me in last 2 weeks and refused to pay me. None of tenants in question appear to know each other.

The reason given by all 12 tenants is:

“The government has decided that, Banks must give you holiday for 3 months, in return we must not pay you for 3 months” When I attempted to explain meaning of holiday does not mean complete waiving off rental payment it simply means deferring payment depending on their circumstances, which means they must reach another agreement as to how they will make payment after 3 months in addition I requested proof of their income being impacted. They have all refused to provide any proof when I raised the possibility to taking matter to Court, most of them suggested I will not be able to do this as all Courts are shut and government will not allow this.

This clearly shows that government has caused a huge confusion and all of tenants appear to think regardless of their circumstances this is “Rent-Free Holiday” I am very worried about this as even if my Bank allows me to take payment holiday which they will, nonetheless, Mortgage Company will simply allow Mortgage payment holiday, but will not replace rent.

My main source of Income is property income, which pays for my Tax, Maintenance and my Livelihood. In addition, if these tenants fail to bring their account up-to-date after 3 months then I would have lost £1000’s and would accumulate further Mortgage debt.

Simon



Comments

Gary Nock

10:32 AM, 14th April 2020
About 4 months ago

This is probably coming from a local eastern european advice centre or website. We own/ manage around 50 properties. There has been one non-payer and landlord had rent insurance guarantee. For the sake of £100 per property it's a no brainer.

The tenants are trying it on to be honest. If they persist and will not listen to reason there is nothing to stop you serving Section 8 or 21 Notices. It's just that you have to wait three months to commence court action. Perhaps they all want to be homeless in August.

Prakash Tanna

10:40 AM, 14th April 2020
About 4 months ago

I had a tenant over the weekend ask for a rent discount. When questioned why, I was told that his girlfriend's employer (who incidentally has refused to furlough her or pay her any salary) told her to ask for it and that all his other employees have managed to agreed discounted rent with their landlords. It's pathetic of an employer to do that to justify not paying their employees or agreeing to furlough them!

john mcghee

10:46 AM, 14th April 2020
About 4 months ago

Exactly the same positio l am in. I have 14 properties, only 3 eastern European families, but each of them are saying the same. This is what happens when housing benefit is paid direct to tenant.
If the government cant see the problems landlords have with this then its time we all sold up and gave the government the headache of housing them.
I am putting my whole portfolio up for sale , another 14 families to be re-housed,
Thanks for reading, john

Anthony Hawes

10:50 AM, 14th April 2020
About 4 months ago

Reply to the comment left by Gary Nock at 14/04/2020 - 10:32
Very similar situation here. We have had one tenant say they can't afford to pay in full due to drop in income but they are still paying something and fully appreciate they will need to make up any shortfall at a later date.

I don't think any or our tenants were as confused as yours Simon but we did take the precaution of writing to them all immediately the various support measures were announced and explained what it all meant.

I don't expect to not have any arrears coming out the back of this but I do believe we can keep them to a sensible level that we should be able to cope with.

Personally, I think, under the circumstances, the government have done a reasonable job of providing support and explaining how it works.

Maybe there are language barriers with some of your tenants which won't be helping but I would be getting something out to them to fully explain and refer them to the correct information.

Good luck.

dismayed landlord

10:50 AM, 14th April 2020
About 4 months ago

my understanding is that rent guarantees are not paying if its due to the virus. Please correct me if I am wrong.

JamesB

10:54 AM, 14th April 2020
About 4 months ago

Issue a MCOL claim to them all and a section 21 .. follow up with a s8 when they withhold next month although timescales on that won’t help atm but offers a CCJ also .. see how many are ok with a CCJ .. they may ignore that but worth a try for the cost involved if you are under that kind of pressure .. first step is work with tenants but clearly you have a different situation here

JamesB

10:55 AM, 14th April 2020
About 4 months ago

Reply to the comment left by JamesB at 14/04/2020 - 10:54
If they are getting benefits apply for direct payments when they miss 2nd month also

Gary Nock

11:00 AM, 14th April 2020
About 4 months ago

Reply to the comment left by dismayed landlord at 14/04/2020 - 10:50
Most Rent Insurers are. Let Alliance certainly is because I have made a claim and had it accepted.

Clint

11:12 AM, 14th April 2020
About 4 months ago

Reply to the comment left by john mcghee at 14/04/2020 - 10:46
Good for you John. It seems to be the only solution. I am doing the same and have 5 properties on the market at present.

Alan Wong

11:20 AM, 14th April 2020
About 4 months ago

Rent holidays in line with mortgage holidays only means 'deferring' the rent so it needs to be paid later not rent free except bankers charge interests on top of their interests when we defer payments to them, we can't. It would be ideal if landlords get mortgage, factoring charges, building insurances, gas safety checks, Eicrs, plumbing, electricals, Council tax, repairs and maintenance, Section 24 tax grab, co-operation tax etc etc and on go the list all holiday 'free' too. But unfortunately we don't and we all have to pay those outgoings day in day out with not £1 of helps from the government. While the government is giving a false front as if they are helping private housing providers with mortgage 'holidays' meaning defer debt for bankers to make more interests. So how is it possible for landlords to give 'rent free' periods when we don't get any expenses/outgoings free period ourselves? Something does not add up.

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