Covid-19: 74% of landlords have been contacted about rent payments

by Property 118

11:21 AM, 21st April 2020
About 5 months ago

Covid-19: 74% of landlords have been contacted about rent payments

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Covid-19: 74% of landlords have been contacted about rent payments

A survey carried out by Landlord Action, has revealed that since government measures to prevent the spread of COVID-19 were introduced on 23 March, 74% of landlords have been contacted by tenants saying they will struggle to pay their rent.

This comes as renters’ unions are calling on the Government to suspend rents for the duration of the coronavirus crisis. But Paul Shamplina, founder of Landlord Action, says there is no ‘one size fits all’ approach, as landlords too have bills to pay and families to feed.

Paul comments: “This is a nightmare scenario for everyone – landlords and tenants alike. It is really important that landlords do what they can to sustain the tenancy if possible, bearing in mind the court system is suspended and if a tenant vacates, there is a worry the property could be empty for a while.  It is about working together in a practical way, understanding each other’s limits and supporting one another as best we can to get through this. I know of landlords who are in a privileged enough position to hold their tenants’ rent and have done so. However, the vast majority of private landlords own one or two properties, many with mortgages, and they too will be facing the same challenges of job losses.”

In the survey, 36% of landlords said they would struggle to pay their mortgage if their tenant did not pay rent this month. Although landlords can apply for a up to a three-month payment holiday on their mortgage if their tenant’s income has been affected by this crisis, with proof, Paul says some landlords are worried about asking for this, because they think it will affect their credit rating. Also, landlords who had already fallen behind with mortgage payments due to rent arrears prior to the crisis may struggle to access a mortgage holiday.

“We’ve been inundated with phone calls from landlords concerned about rent payments and our advice is this: Speak to your tenants. Understand how they are financially impacted; explain how you will be financially impacted. Where possible try and come to an arrangement with them, understand what government support they are asking for. Having something to help cover the mortgage is better than nothing.”

Landlord Action has also drawn up Rent Repayment Agreements for landlords providing a template which enables them to set out agreed terms of the repayment with their tenant. Perhaps more reassuring for tenants, is that nearly 70% of landlords who were asked if they could hold off serving an eviction notice if their tenant falls into arrears within the next three months responded yes.

“Good tenants do not become bad tenants over-night. These are extraordinary circumstances, and everyone is impacted in some way. Those landlords who work with their tenants throughout this difficult time will strengthen their relationship and be far more likely to maintain the tenancy in the long-term. We must all do a little more and give a little more where we can” concludes Paul.

*Survey responded to by 537 landlords

Contact Landlord Action


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Comments

Andrew

12:17 PM, 22nd April 2020
About 5 months ago

It shouldn’t be the landlords responsibility to get involved with the tenants finances. The tenant should be contacting the government and asking them for help with their rent and provide proof to them regarding not being able to fulfil their tenancy agreements obligations and it should be a loan given to the tenants that they are required to repay if required at all. Doing it this way would keep both tenant and a landlord happy.

Monty Bodkin

12:31 PM, 22nd April 2020
About 5 months ago

*Survey responded to by 537 landlords

How were the landlords selected?
Doesn't seem representative of all landlords.

Jo Westlake

12:44 PM, 22nd April 2020
About 5 months ago

Is it 74% of tenants have contacted their landlord or is it 74% of landlords have been contacted by at least one tenant?
I would suggest the latter is more likely.

I have 31 separate tenancy agreements covering 52 tenants . One tenant misunderstood the original government statement and thought everyone was getting free rent and mortgage. That took about a minute to clear up. One tenant contacted me to say she was furloughed and her rent might be a few days late. She always pays early so this month it was 7 days early instead of the usual 10 days.
The only one I've had multiple emails from is a student who had been sent a letter from the Student Guild to give to landlords asking to release students from their contracts. Their justification was because Unite had released theirs. No thought had gone into the differences between joint and individual tenancy agreements. The fact that a surprisingly high number of students have decided to stay in their student housing must have escaped the Guild. It seems some students have obtained key worker jobs in their University cities while others have vulnerable high risk family members at home and want to allow them to better self isolate.

I am expecting to have a couple of tenants with genuine difficulties when the furlough money comes through. It will be 80% of less than they thought. UC may help but it will depend on if it gets back dated.

One comment made by a single mum who has been furloughed and gets benefit top ups is that now there is nowhere to go such as cafes, pubs, kids activities, etc it's made her realise quite how much money she was spending on such things.

As far as I can see there are various categories that tenants fit into and financially it certainly isn't all doom and gloom right now. Maybe in a few months time more people will be in difficulties.
Right now millions of people are working flat out in key worker roles often earning far more than usual. Millions more are working from home or in workplaces where social distancing is possible, all earning their usual pay. Anyone on benefit has had a substantial increase. People who are furloughed are getting 80% of something, have no work related expenses such as travel or childcare and can go and get a temporary job on top if they choose to.
Students are still getting their student loans, some will be getting furlough money from their part time bar or restaurant jobs and they can work.
The self employed are probably having the most problems but it will be an industry by industry issue.

Personally I expect to have 2 or 3 tenants who will genuinely need assistance and I want to be in a position to give that assistance. In order for me to do so it's important that tenants who are able to pay continue to do so.

Monty Bodkin

13:45 PM, 22nd April 2020
About 5 months ago

"In a statement Ben Beadle, Chief Executive of the National Residential Landlords Association said recent polling has indicated that just two per cent of private tenants have had to stop paying rent due to the pandemic"

Neil Patterson

16:17 PM, 22nd April 2020
About 5 months ago

The title has been amended to be more accurate thank you.

David Lawrenson

9:42 AM, 24th April 2020
About 5 months ago

We have only been contacted by one tenant, and then they were able to pay the rent anyway.
The odd thing is that they were a couple, where the male partner is a prison officer, whose income alone was over 2.7 times the rent. He is still in work.
The female partner was put on furlough, though she was saying her employer wanted to put her on SSP, despite her not being sick. All very odd.
We sent them the link to the government's website for help with Covid and pointed out the fact that the boyfriend alone had income enough to support the rent. That was the last we heard. Rent was paid.
My view is that if one has responsible tenants, one should let the tenants contact you first, otherwise remain quiet. After all, you are not social workers. But be supportive when they get in touch.

All our other tenants continue to pay their rent.
David Lawrenson
http://www.LettingFocus.com
Private Landlords Advice


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