ARLA Propertymark has written to the Secretary of State for Justice expressing concerns for the management of housing possession cases in England and Wales when the current stay on possessions is lifted on 23 August 2020.
A copy of the letter was also sent to The Master of the Rolls and Christopher Pincher MP, Minister of State for Housing.
The letter says:
Dear Lord Chancellor,
Re: Management of Housing Possession Cases
I would like to express our significant concerns about the management of housing possession cases when the current stay on possessions is lifted on 23 August 2020.
ARLA Propertymark believe the volume of cases that has accumulated since the stay came into force on 26 March 2020 and the impact on the private rented sector cannot be underestimated; and in order to ensure no one is denied or delayed the right to justice a robust and co-ordinated strategy must be developed as a matter of urgency.
As the leading industry body for letting agents, ARLA Propertymark is significantly concerned about the volume of cases that were already in the housing possession system prior to the introduction by the courts of Practice Direction 51Z issued on 26 March 2020 which effected a stay on possession claims during the Coronavirus pandemic and any claims that would naturally have been made during this time.
Based on the UK Government’s mortgage and landlord possession statistics for 2019 ARLA Propertymark estimate that when the stay on possession claims expires there will be a potential backlog of over 62,000 “business as usual” landlord possession claims to be processed across England and Wales, without even considering any claims for possession that may have arisen directly as a result of COVID-19.
Data from the UK Government found that 17 per cent of landlord possession claims were using the accelerated procedure, leaving a not inconsiderable 52,000 claims requiring court hearings.
This extraordinary number of claims will undoubtedly be replicated in other areas of the court’s work and will require a robust strategy to ensure these cases are heard.
Further, the 2019 landlord possession statistics provide that 68 per cent of landlord possession claims result in an Order for Possession being granted by the courts.
Using these statistics, approximately 40,000 Possession Orders would have been granted to landlords had the court been operating normally and these are now part of the ever-accumulating backlog; again, not taking into account the impact claims directly relating to COVID-19.
Despite a landlord being granted a Possession Order, Warrants for Possession due to tenants refusing to leave were required in 65 percentof cases.
Again, in a normal year, during the stay on possessions these statistics suggest over 26,000 Warrants for Possession would have been issued by the courts.
aking the process to the next stage, Warrants would likely have developed into landlords requiring enforcement by County Court Bailiffs in approximately 14,000 cases.
Given that the average time from the Warrant for Possession being issued to the possession being enforced was 10 weeks before lockdown and therefore the overwhelming number of cases currently being processed through the justice system will put even further pressure on an already stretched service.
Every week that a landlord must wait to regain possession of their property is a week of lost income; particularly affecting private landlords and agents who may be relying on rental income to pay their own mortgages and bills.
Within the backlog of possession claims accumulating during the stay on proceedings, private landlords would have needed to wait for possession to be achieved by using a bailiff on over 3,300 occasions.
The English Housing Survey 2017-18 estimates the average weekly rent in the private sector was £193.
Based on this, if a landlord had issued a claim for possession on the day the stay on possessions came into force, by the time cases re-start, landlords would have incurred a loss of £4,149 purely due to the suspension.
The average time from claim to possession by a County Court Bailiff is already 22.8 weeks for private landlords.
This means the landlord who submitted a claim immediately before the stay on possessions will incur an average rental income loss of £8,549 due to these restrictions.
The evidence provided above demonstrates that before the stay on possessions is lifted, there must be a robust strategy in place to manage the large number of cases that will have accumulated.
ARLA Propertymark believes there are a number of key factors which must be addressed for any such strategy to be effective.
Consultation and engagement with industry bodies representing landlords and letting agents must begin as a matter of urgency.
This will ensure that plans take into account the needs of landlords and agents, as court users, rather than just focusing on tenant organisations, and that the impact of the situationon the private rented sector more generally needs to be considered.
To avoid further exacerbating additional work for the courts and costly delays for all parties it is imperative that appropriate legal advice and advocacy is made available to all parties in possession cases at this time.
Without proper advice and representation there is a very real likelihood of cases being adjourned and an increase in appeals.
The impact on the Housing Possession Court Duty Scheme will need to be understood and the service sufficiently resourced to meet the increase in demand.
We do not underestimate the challenges ahead as the country continues to recover from the effects of COVID-19.
ARLA Propertymark urges the UK Government to urgently move to develop a robust strategy to manage the re-opening of the courts for landlord possession claims and to work with us and our members to put an effective strategy in place.
We would very much welcome the opportunity to meet with you to discuss this important matter.
Chief ExecutiveARLA Propertymark
*All Credits to Property Industry Eye*