OpenRent says it has reconfigured its systems to enable landlords to give tenants a ‘rental holiday’ if they lose their jobs.
The UK’s largest lettings agency OpenRent has launched a button on its site that enables landlords to stop rent collection efforts by the platform if their tenants get into financial difficulties.
Called a ‘rent pause button’, it enables temporary agreements between landlords and tenants to be recorded by the OpenRent platform. “We have added this feature because we know that many landlords want to be sensitive to their tenant’s position during the coronavirus emergency,” says founder Sam Hurst from OpenRent .
“Rent pause makes it quick and easy for compassionate landlords to ensure their tenants are not caused unnecessary stress.
“Landlords who press pause will temporarily halt all rent-chasing emails that are usually generated by our rent collection service.
“Tenants can continue paying any agreed rent to us, but the system will no longer chase for the full rental amount. This accommodates any temporary payment arrangements that have been agreed between landlord and tenant.”
OpenRent says the recently-introduced tenant fees ban complicates matters because it prevents landlords charging higher rents to recoup lost rent at a later date once the pandemic is over.
It also claims that there is a convention in the private rented sector that if a lower rent is charged to a tenant, it is hard to then increase the rent at a later date.
Consequently, OpenRent has told LandlordZONE that it realises landlords and tenants will be apprehensive about written agreements.
It is therefore currently writing a guide to ‘temporary rent reduction’ agreements, in partnership with leading law firm Anthony Gold which, once finished, will circumvent these challenges without having to amend an existing tenancy contract.
In general, the written agreement stuff is tricky because:
– the Tenant Fees Act prohibits agreements which require higher rental values to be paid later in the tenancy, as this would be a clear fees loophole
– there is a convention that if a new rent is agreed and then collected, then this becomes the new rent going forward indefinitely