The Chartered Institute of Housing NI has today published proposals aimed at avoiding a potentially disastrous spike in evictions once the current protections end.
Governments and many landlords have put in place temporary measures to help tenants keep their homes in the current crisis. Sustaining people’s incomes through the furlough scheme and putting an effective halt to evictions have created a temporary respite.
But what happens when those temporary measures end?
Working with barrister Liz Davies, CIH Northern Ireland has developed a detailed set of proposals to avoid a crisis that could leave thousands homeless and cost landlords and the Housing Executive millions.
Justin Cartwright, CIH national director for Northern Ireland said: “For the 260,000 households who are tenants of private or social landlords in Northern Ireland, a key part of the hardship and suffering during the crisis has been the struggle to pay their rent and worrying if they will be able to keep their home. If our society and the economy are to recover from the crisis, it is vital that these fears are allayed quickly and thoroughly.
“We do not start from a good place. Housing Executive and housing association resources for dealing with homelessness were stretched before the epidemic and could be overwhelmed if there is a sudden growth in evictions due to rent arrears.”
The hard facts:
• Employed renters are more likely than homeowners to work in jobs bearing the greatest economic and health risks in this crisis
• Unemployment benefit claims in Northern Ireland have increased by almost 90 per cent, from 29,700 to 56,200 in April
• The NI economy could shrink by 7.5 per cent this year because of the crisis.
The furlough scheme helps to sustain incomes but has a shortfall of 20 per cent if not made good by employers. When the scheme ends people may lose their jobs, have lower earnings than before, or have used up their savings.
Protection against eviction, afforded by courts only listing urgent matters and the ‘notice to quit period’ extension, are time bound measures. Ending them may result in a potentially large number of eviction actions within a short period.
Justin added:“The burden cannot simply be put onto landlords. That could lead to defaults on mortgages and enforced sales, which could deplete the sector just when that capacity is most needed. This needs government action too.”
What is CIH Northern Ireland’s ‘post-Covid’ solution?
• Evictions ban to be introduced until they can take place safely and a pre-action protocol is in place.
• Put a temporary ban on evictions solely arising from COVID-related arrears.
• For private tenancies with no fixed term, stop evictions where no reason is given.
• Make sure that payment plans for COVID-related arrears do not result in eviction, provided the tenant agrees with and complies with the plan over a timescale of up to two years.
• Reform universal credit: end 5-week wait; temporarily suspend the benefit cap and the two-child limit; increase LHA to 50th percentile of rents for a limited period; end ‘shared accommodation rate’ for under 35s.
• Introduce an interest-free loan scheme to cover landlords’ loss of rental income and give landlords mortgage holidays on rented properties to pass relief on to tenants.
• Consider one-off payments to stabilise Housing Executive and housing association finances where these have been hit by COVID-related arrears.
Gavin Smart, chief executive of CIH said: “While the measures put in place by governments and landlords are helping millions of people during this awful time, we have to think about what comes next. Simply ending all these measures without a plan to cope with the arrears built up through the outbreak risks pushing families into homelessness and landlords into bankruptcy, just at a time when a stable housing sector is needed to help rebuild our economy.
“Our proposals are practical and proportionate to the threat facing millions of people. We look forward to working with the governments across the UK to make them part of our national post-COVID recovery plan.”