Landlords in England and Wales are calling on the UK government to provide “hardship loans” that will help tenants pay off coronavirus-related rent arrears.
This comes as landlord confidence sees its sharpest decline since the beginning of the pandemic, according to a survey of 2,000 members of the National Residential Landlords Association (NRLA).
Half (48%) of landlords now believe rental business will face a “slight” negative impact over the next 12 months, while 18% believe it will take a “significant” hit, the survey found.
As a result, 56% of landlords are “less” or “much less” confident they will be able to achieve their annual goals than they were three months ago.
Previous NRLA analysis suggests total private sector private renting arrears as a result of the pandemic may come to £437m ($570m) in England, alone.
Because of this, landlords are asking the government to help sustain tenancies by providing interest-free loans similar to those already available in Scotland and Wales.
These loans would specifically cover unpaid rent since lockdown measures were enforced on 23 March, with payments made directly to landlords.
Nearly four in five or 78% of landlords support the development of such a scheme, the survey found.
It also has the support of Lord Richard Best, the former chief executive of the Joseph Rowntree Foundation. “The landlord is happy, the cost to government is very modest and to the tenant, bearable,” he said
COVID-19 is also affecting landlords’ investment decisions, with just 16% planning to purchase at least one property over the next year, while 30% intend to sell one or more properties.
This will likely result in decreased supply of rental homes – despite 35% of landlords reporting increased demand for privately rented housing over the past three months.
Chief executive of the NRLA, Ben Beadle, said: “While the vast majority of landlords have been working constructively with their tenants where they have struggled due to the pandemic, it is not sustainable to expect them or tenants to continue having rent arrears building indefinitely.
“Providing the financial support needed to help tenants pay off rent arrears built since lockdown started would cost the government less than the Eat Out to Help Out scheme.
“As we head into more local lockdowns, it is even more important that tenants don’t have to worry about meeting their rent bill.”
Watch: What do stamp duty cuts mean for buyers and house prices?