The first attempt to assess the loss of rental income as a result of Coronavirus calculates 22 per cent of private landlords have suffered reduced rent.
Conducted by YouGov for the National Residential Landlords Association, the survey finds 19 per cent of those questioned had lost up to half of their usual rental income - three per cent had lost over half.
An analysis of the results by the NRLA suggests that among those landlords surveyed saying that they have faced a loss of rent, the average median loss was between £751 and £1,000.
Applied across the sector as a whole, this suggests that the total rental income lost by private landlords with properties in England as a result of COVID has been between £328m and £437m.
The same survey shows nine per cent of landlords say they plan to leave the market altogether with seven per cent saying they will sell some of their rental properties over the next 12 months.
The NRLA says this would choke-off the supply of available homes for those unable to afford a home of their own, those struggling to access social rented housing and those who prefer the flexibility that the private rented sector provides.
With the polling showing that 61 per cent of landlords let out just one residential property, and 34 per cent of those saying they are retired - with rental income representing all or part of their pension - the NRLA argues that it is unsustainable to expect landlords and tenants to be building up rent arrears indefinitely.
Ahead of the courts hearing possession cases again from September 20, the NRLA has reiterated its call for an urgent financial package from the government to pay off COVID related rent arrears and sustain tenancies.
The NRLA proposes that the Westminster government follows the examples set in Wales and Scotland and develops interest free, government guaranteed hardship loans for tenants to cover arrears built since lockdown started in March.
“Where COVID-19 has caused difficulties for tenants, the vast majority of landlords have reached agreements with them to avoid problems. That said, most landlords are not property tycoons and cannot be expected to go indefinitely without any or only part of the rent they are owed” explains NRLA chief executive Ben Beadle.
“To date there has been no direct financial support for the rental market, with individual landlords unable to access small business grants or bounce back loans. The furlough scheme is due to end, benefits do not cover average rents in any given area and the mortgage deferral scheme only builds up the amount landlords have to pay for the remainder of the term of their mortgage.
“The [Westminster] government needs to step in and ensure tenants and landlords in England have the same level of support being provided in Scotland and Wales to pay off rent arrears and sustain tenancies.”
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I am surprised that the number of landlords intending to sell up is not higher.
Well it is a combined 16% if you include part disposal, which is massive. Even at 9%, if true and the trend continues gathering pace with the remaining Landlords being significantly more risk averse regarding the quality of their tenants, then there is your social housing crisis in one fell swoop, albeit I thought we were in one anyway.
However, one thing the government has perhaps been particularly clever about is closing any window on LLs getting out cheap if they increase CGT in the autumn. The six month notice basically stops a LL selling to an end user before the CGT increase will likely come in in April, essentially meaning that if a LL does try and sell, they can only sell to another investor, thus stopping a massive reduction in the PRS. Could be a complete coincidence though, they haven't been clever about much in recent memory.
Remember the policy wonks at the Treasury are easily able to work out what policies they need to initiate to force LL into continuing to provide free accommodation.
The thing I find strange about this is Govt is keen to get rid of LL.
So the CGT thing would trap LL into staying.
While of course they will have to suffer rent defaulting tenants until EVENTUALLY evicted.
Rather than increasing CGT if they reduced it substantially for LL there would be a rush by LL to sell up.
So we have S24 to get rid of LL and increased CGT to keep them from selling up!!
Doesn't make any logical sense!
The 2 are about 7 years apart in their design, about 10 housing ministers, 3 GEs, 1 referendum and exit from the EU, a pandemic. A lot has changed, it is not one strategy or a joined up set of policies. It is one isolated, knee jerk, reactionary bit of statute after another, which is why by design it is also not an attempt to get rid of private LLs.
What does CGT mean sorry if it's a stupid question but am new to the game
Capital Gains Tax.
Thanks
@mattpayne
As long as S24 remaibs on the Statute books then Govt still wishes to get rid of levsraged LL in particular.
The fact that the kneejerks contradict eachother doesn't mean Govt has given up on eradicating LL.
It is just their chaotic way of managing things.
Essentially I see it as the left hand not knowing what the right one is doing.
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