Call for struggling tenants to benefit from landlords’ mortgage payment holiday

by Mary-Anne Bowring/Property Industry Eye

Renters waiting for income support or not covered by government schemes should see a reduction in their rent if their landlord has secured a mortgage holiday and they risk breaching affordability criteria, the boss of one of the UK’s leading residential property consultants has urged.

In March the government announced landlords can apply for a three-month payment holiday on their buy to let morgages if their tenant is under financial strain as a result of the pandemic.

To help renters, the government has banned eviction proceedings from happening and urged tenants to work with their landlord in situations where they are struggling to pay rent.

A recent survey by Landlord Action found nearly three-quarters of landlords had been contacted by tenants about rent payments, highlighting the severe impact the lockdown has had on household finances.

Mary-Anne Bowring, group managing director at Ringley, which manages thousands of homes across the UK, has called for further support to help renters either not covered by income support schemes or who have not yet received the additional cash.

Bowring said tenants who are out of work and struggling on reduced incomes should be able to ask if their landlord has secured a mortgage repayment, interest, or repayment-and-interest holiday.

If their landlord has benefited from a mortgage holiday, renters should also be able to ask to have their rents reduced if they can prove they are not eligible for cash through the government’s income support schemes and their reduction in income leaves them below the original affordability criteria upon which their tenancy was originally assessed and granted.

Housing charity Shelter recommends tenants spend no more than a third of their income on rent, although in London renters can frequently pay up to 40 or 50 percent.

Bowring said:

“The word ‘unprecedented’ has been used a lot in response to the impact Coronavirus is having but statistic after statistic shows a level of damage not even seen during the worst of the Great Financial Crisis.

“The government has moved decisively to help protect tenants and landlords, but it is inevitable some households will fall through the gaps as the various income support schemes get up and running and payments are processed.

“Transparency is key, and renters have a right to know if their landlord has benefited from a mortgage holiday and if the tenant is struggling financially they should be able to request a reduction in rent.

“Any rent reduction must be conditional on being able to prove financial hardship to prevent abuse and it is important tenants and landlords work together during this uniquely difficult time.

“What is important is that the government doesn’t effectively payout twice.”

https://propertyindustryeye.com/call-for-struggling-tenants-to-benefit-from-landlords-mortgage-payment-holiday/