How changes caused by the pandemic have affected the property industry

How changes caused by the pandemic have affected the property industry

Changes in the property industry over the past couple of years have affected homeowners, landlords, and tenants in many ways. Due to a range of factors, a need for change has arisen, and the Government has responded by bringing in new regulations and amendments to existing legislation.

Stamp Duty holiday for UK properties

From July 2020 to June 2021, homebuyers had the opportunity to buy a UK property without having to pay Stamp Duty Land Tax for less than £500,000. The aim was to boost the property market in the UK during the COVID-19 pandemic.

The Government brought in this tax holiday to boost the UK property market during the COVID-19 pandemic. Once the 30th June 2021 deadline passed, the holiday was gradually phased out, with the purchase price threshold lowered to £250,000. On 1st October, the rates went back to normal. Homebuyers must now pay Stamp Duty on a property that costs £125,000 or more unless they are a first-time buyer.

Changes to evictions in England

Due to the pandemic, there was a ban on evictions in England from March 2020 to May 2021. Landlords also had the option of a mortgage payment holiday if they had tenants experiencing financial difficulties due to COVID-19. 

Robert Jenrick, who was Housing Secretary at the time, commented: “The government is clear – no renter who has lost income due to coronavirus will be forced out of their home, nor will any landlord face unmanageable debts.”

In March 2020, a 3-month eviction notice period was introduced as part of the Coronavirus Act 2020. It was extended to six months in August 2020 until May 2021, then from June 2021 to September 2021, the notice period became four months. From 1st October, notice periods reverted to “pre-pandemic levels”.

There are also plans to abolish Section 21 ‘no fault’ evictions, which will impact the options available for landlords looking to regain possession of a property.

Removal of the blanket ban for pets in rented homes

In January 2021, the Ministry of Housing, Communities & Local Government announced a change to its standard tenancy agreement. It no longer allows landlords to issue a blanket ban on pets.

Consent for tenants to keep pets is now the default, according to the updated Model Tenancy Agreement. If a landlord has a reason to object, they must do so in writing within 28 days of a written request from a tenant to have a pet. Landlords must also provide a good reason for their objection, such as smaller properties or flats not being practical for keeping pets.

The Government’s press release clarifies that tenants “will continue to have a legal duty to repair or cover the cost of any damage to the property.”

Changes to Universal Credit

During the pandemic, an increase in the amount paid to Universal Credit claimants was announced. Chancellor Rishi Sunak said in his updated statement on coronavirus: “I’m announcing today (20th March 2020) nearly £1bn pounds of support for renters by increasing the generosity of housing benefit and Universal Credit, so that the local housing allowance will cover at least 30% of market rents in your area.” The temporary increase then ended in October 2021.

James Collins, Managing Director of specialist landlord insurance provider Just Landlords, comments: “We have seen a number of changes made by the Government to help support and stabilise the property industry. The mortgage payment and Stamp Duty holidays provided the opportunity for the property market to get moving again after the initial shock of the pandemic. We will keep our fingers crossed for a more stable and safe year in 2022.” 

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