This browser is not actively supported anymore. For the best passle experience, we strongly recommend you upgrade your browser.
Back

Blog

| 1 minute read

Increased arrears and extending the reactivation notices period

As reported by Housemark, arrears are 30% higher than they were in March 2020. Not surprising when there was a possession stay for 6 months from March 2020 which meant no new proceedings could be issued and no existing cases continued. Even though the stay was lifted on 20 September 2020 there has been an eviction ban in force from 11 December which lasts until 21 February 2021, though we can perhaps expect that to be extended.  

One housing association income team manager recently described to me that they were "working very hard to stand still". Great efforts are being made to contact and provide support to tenants in response to their changing circumstances and with benefits advice. There are however some cases where there has just been no engagement and the arrears keep growing, so landlords have been gradually looking to serve the required reactivation notice (on cases stayed before 3 August 2020).

The period during which reactivation notices were to be used was due to end at 4pm on Friday 29 January 2021. Some landlords have been focusing on drafting and sending notices to court before that deadline in recent weeks (as no court fee is payable with such a notice). When the reactivation notice period ends, a general stay kicks in, and a landlord would have to make a written application to lift the stay. As this type of application must be on notice, the court fee payable would be £255 per case, so not an insignificant sum.

However as is frequently the case at present, this deadline was, without any advance announcement of any kind(!) extended on the afternoon of the 29th just before the deadline expired. Reactivation notices can now be used until 30 April 2021. Some good news for landlords at least.  

Figures collected by HouseMark showed a 30% increase in outstanding rent arrears since March 2020, with forecasts suggesting that arrears levels may not return to pre-pandemic levels until March 2022. Many renters have faced extreme financial hardship as a result of the repeated lockdowns that have been put in place throughout the pandemic. The increase equates to an additional £300m in arrears since March, which contributed to the record total of £1bn. The data is based on figures from 104 social housing providers for the month of December 2020, with trend data since March 2020.

To make sure you receive all of our latest insights, subscribe here.

Tags

housing management, housing litigation, social housing, housing, rent arrears