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Agreements with tenants

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Record numbers of tenants have fallen into rent arrears during the Coronavirus pandemic. Many have no record of arrears but they have had to survive on furlough pay or less.

This is sad, but landlords should not feel they have to bear the brunt of this, writes Sharon Betton. 

If you have been following good practice guidance, you will know exactly how much in rent arrears your tenants are; they should have received pleasant letters, explaining what steps you intend to take to rectify the situation.  Those landlords who have allowed rent free periods will have issued agreements, explaining for exactly how long the rent free period will last and when rent payments should resume.

I am afraid that the sceptic in me feels that some of the rent arrears have accrued because tenants know landlords been forbidden to evict any tenants until 31t March 2021 and are required to give six months’ notice. 

I will not say that is the case for all tenants in arrears, but the feeling of a landlord who receives half his rent, with copious apologies and promises to make it up, when back at work, are quite different from the tenant who pays nothing. 

I know that applications for Universal Credit are taking a while to process, but when the claim goes through, the housing element should be paid to the landlord.

That rent arrears are accruing for the vulnerable would indicate that some people are not taking responsibility for keeping a roof over their, and their children’s heads.

We have no idea when this will be over; economists are predicting a very long period until we can feel we have an economic recovery.  What do you do with tenants in high rent arrears?  Well, you can evict them. 

You would have the hassle and expense of going to Court, then finding other tenants, gas safety checks, decorating that is almost always needed when a tenant vacates, even if they have gone voluntarily.  If they are good tenants, never an ounce of trouble, keep the property clean and tidy, you may be hesitant about trying to replace them.  You will know your tenants. You will know whether, when things return to some semblance of normal, your tenant may try to make up some of the arrears. If that is the case, it is worth being reasonable with the tenant, and trying to reach some agreement about how you can be recompensed. 

Do any of your properties need clearing? A deep clean? The garden brought into order? Decorating or window washing? These are all tasks that are needed and which the good tenants, the ones you want to keep, may be happy to do for you.  No-one should be forced to do anything, of course, it is purely voluntary. But some would be happy to do some tasks in return for the rent debt being reduced slightly. There is also the aspect of a tenant’s self-respect.

If you enter into any agreement like this, add an addendum to the tenancy agreement, be very clear what you expect and how the tenant will be recompensed – that is, by reducing outstanding rent arrears by such and such an amount. He or she is not an employee, but is being recompensed for undertaking a particular task, just the once.

This idea may save evictions, may keep tenants in homes. But be clear what hours you expect and tell your tenant the hourly rate, which will be deducted from the arrears.  What have you to lose?  Both sides could be winners.