BlogLatest NewsLandlords are using their savings to absorb rent arrears says survey

Landlords are using their savings to absorb rent arrears says survey

Landlords are using their savings to absorb rent arrears says survey

A new study has shown that 61 per cent of landlords were forced to dig into their personal savings to help during the pandemic.

 Many private landlords have taken the financial hit to support tenants who were unable to pay their rent.

Almost 800,000 tenants were behind with their rent in April-May this year according to Government data, which was more than double the number who said they were in arrears in 2019/20, before lockdown measures started.

The research was undertaken by BVA/BDRC for the National Residential Landlords Association (NRLA). It shows landlords who, in the second quarter of the year, had offered at least one tenant a rent free or deferred rent period, had absorbed the losses from their savings.

Some of the pressure should be relieved by a new Government support scheme for tenants.

People struggling to pay their rent due to the impact of the pandemic will be helped by a £65 million support package announced by the Department for Levelling Up, Housing and Communities in October.

The funding will be given to councils in England to support low-income earners in rent arrears – helping to prevent homelessness and support families get back on their feet.

Across the country, 61 per cent of landlords rent out just one property, according to recent figures from polling and analysis firm YouGov.

Of these, 34 per cent are retired with rental income representing all or part of their pension.

The industry body is warning that reliance on landlord savings is not sustainable in supporting tenants facing rent problems.

Ben Beadle, chief executive of the NRLA, said: “These figures show the extent to which landlords have worked to sustain tenancies as a result of the pandemic, many at the expense of their retirement savings. But this cannot continue indefinitely.

“After months of calling on the government to help tenants who through no fault of theirs got behind with their rent, we have welcomed the funding now made available to help those affected to pay off Covid rent debts.

“It is now vital that councils ensure tenants who need it can access the funding swiftly. Without this, landlords will be left between a rock and a hard place either expected to sustain rent arrears they cannot afford or to repossess their properties, neither of which we want to see.”

For help and advice with commercial property matters, please get in touch with our expert team today.​​​​​​​

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