Government now admit many landlords are highly vulnerable to rent arrears

Government now admit many landlords are highly vulnerable to rent arrears

9:39 AM, 21st September 2021, About 2 years ago 3

Text Size

Failure to address COVID rent debts shows Government has given up on those struggling through no fault of their own. Private renters and landlords across the country face a cliff edge as the end of furlough coincides with cuts to benefit support.

With Bank of England warnings indicating that renters are more likely than any other group to have lost their jobs or been furloughed, the National Residential Landlords Association argues that many more renters face the prospect of mounting rent debts.

A new report published by the NRLA today shows that, by the Government’s own admission, the proportion of private renters in arrears tripled in the period from 2019/20 to the end of 2020 from three to nine percent.

With furlough due to draw to a close at the end of September, alongside a £20 a week cut to Universal Credit and a continued freeze to housing benefit support, many more tenants are likely to accrue unsustainable debts.

The NRLA points to warnings from the Bank of England about the risks posed to the country’s economic recovery as a result of renters experiencing financial difficulties. It also highlights concerns about what impact a failure to tackle COVID related rents debts will have on the credit scores of affected tenants, as well as the likelihood that they will be able to stay in their homes.

With the Government having now admitted that many landlords “are highly vulnerable to rent arrears”, the NRLA argues landlords cannot be expected simply to deal with non-payment of arrears.

The NRLA is calling on the Chancellor to develop an interest free, government guaranteed hardship loan to support the majority of tenants with COVID related rent debts who are not eligible for benefit support. This scheme would help these tenants to pay off their rent debts and would follow the introduction of similar schemes in Scotland and Wales. More broadly, it is calling on the Government to scrap plans cut Universal Credit payments to avoid potentially devastating consequences for tenants across the country.

Ben Beadle, Chief Executive of the National Residential Landlords Association said:

“Many tenants and landlords have struggled to cope during the pandemic leaving them exposed to the impact of rent debts which they are unlikely to ever pay off.

“By ending furlough and cutting benefits in quick succession, and without the introduction of a targeted package to tackle COVID related rent debt, the Government is worsening an already critical situation. Without transitional support, and as the country gets back to normal, the Chancellor will be turning his back on those renters and landlords in desperate need of help.”

Share This Article


Paul Essex

13:46 PM, 21st September 2021, About 2 years ago

Why are the NRLA still pushing the loan idea - if they are not paying the rent, but could there is no incentive to take on debt, if they are genuinely struggling they are unlikely to qualify for a loan anyway!
There needs to be an incentive here, perhaps if they don't take a loan to pay off the debt we could have automatic access to accelerated possession.
( Just distracted by a flock of pigs passing the window).

Monty Bodkin

15:01 PM, 21st September 2021, About 2 years ago

"the NRLA argues landlords cannot be expected simply to deal with non-payment of arrears."

They should be strongly arguing for keeping section 21 rather than daft loan schemes that haven't worked in Wales or Scotland.

Monty Bodkin

11:01 AM, 23rd September 2021, About 2 years ago

Ben Beadle, Chief Executive at the National Residential Landlords Association, said:

“This announcement indicates that the Welsh Government lacks a coherent strategy to address the many issues affecting the private rented sector. The little publicised Tenancy Hardship Grant has helped less than half a dozen tenants"

Leave Comments

In order to post comments you will need to Sign In or Sign Up for a FREE Membership


Don't have an account? Sign Up

Landlord Tax Planning Book Now