Nearly half of landlords have offered financial support to cash-strapped tenants, according to new research.
The survey of 729 landlords found that 44 per cent have come to some form of financial rescue for their tenants.
It suggested that landlords have been able to swallow a 7.6 per cent reduction in rent on average. It equates to around £50 a month for each rental property they own.
A total of 44% of landlords have come to the financial rescue of their tenants, according to a new study
The survey was carried out by Nationwide Building Society’s The Landlord Works – a platform to help landlords manage their portfolios – between March 6 and March 24.
It asked landlords what financial support, if any, they had given tenants in the past year, along with how they intended to offer support in the future.
While many are able to reduce rents, 45 per cent of landlords confirmed that any reduction would harm them financially.
And 38 per cent said they intend to keep rents the same for the next year despite the financial challenges.
More than half – at 55 per cent – said they need to increase rents in the next 12 months, with one in four planning to raise rents on all of their properties.
Landlords with larger portfolios are more likely to increase rents on at least some of their properties, the survey reveals.
Three quarters of those who own more than 10 properties aim to increase their rents over the next 12 months, compared to only 44 per cent of those owning between one and three properties.
A total of 46 per cent of those landlords with a small portfolio plan to keep rents the same.
Where are people getting more help?
There are regional differences, with 68 per cent of landlords in Yorkshire & The Humber most likely to increase rents on some or all of their properties in the next year.
It is followed by those in outer London at 65 per cent, the North West at 63 per cent and Wales at 63 per cent.
Despite the plan to increase rents, 57 per cent of landlords are concerned about whether tenants can maintain their rental payments, with 13 per cent admitting they are very concerned.
It increases to 74 per cent of landlords who let to claimants of Local Housing Allowance and 71 per cent of landlords who let to retired people.
Landlords in East Midlands appear to be the most concerned about the ability of their tenants to pay rent, at 74 per cent.
It is followed by 70 per cent of landlords in Wales and 62 per cent in Yorkshire and the Humber.
Meanwhile, only 32 per cent of landlords in central London are worried about receiving their rent.
The survey suggests that landlords have been able to typically reduce rents by around £50 a month
In terms of the support offered to tenants by 44 per cent of landlords, temporary reductions and rental payment holidays are the most common options.
The survey suggested that 22 per cent provided a temporary rent reduction, 15 per cent offered a payment holiday and 4 per cent offered a permanent reduction in rent.
Only 3 per cent of these landlords lent money to support their tenants’ day-to-day living costs.
Larger reductions in rent
Landlords with smaller portfolios were found to be able to reduce rents by a slightly higher amount.
Compared to the average of 7.6 per cent for all landlord types, those with one property can reduce by an average of 8.7 per cent, while those this two or three properties are able to reduce rents by 9.3 per cent.
Of those who could reduce rents, 47 per cent said they could keep the reduction going for between three and six months.
The 60 per cent of landlords making a full-time living from their lettings activity, and the 51 per cent who are retired are more likely to say they could sustain the rent reduction for more than six months.
Some landlords – including some of those who are retired – have been able to reduce rents for more than six months
Paul Wootton, of The Landlord Works, said: ‘Landlords are facing a real dilemma at the moment in dealing with the continued rising cost of living.
It’s great to see such a high proportion of landlords feel a sense of responsibility towards supporting these tenants during these challenging times
‘On the one hand, there is a need to ensure they can cover the increasing costs associated with their properties and ensure they are following the market. However, as our research demonstrates, they are also acutely aware of the financial challenges facing their tenants.
‘It’s great to see such a high proportion of landlords feel a sense of responsibility towards supporting these tenants during these challenging times.
‘And in a lot of cases, this sentiment has been met by financial support for their tenants over the last twelve months.
‘While we will see rents rise over the coming months in many cases, we can also expect landlords to offer continued support at what is a tough time for many.’
It comes after property website Zoopla highlighted the financial strain that tenants are under.
Its research found that there is a significant increase in the proportion of gross income spent on rent.
This is particularly the case in London where it has risen to a significant 52 per cent for a single earner, a level not seen since March 2020.
It falls to 26 per cent for sharers and means that a new let agreed for an average rent in London will cost more than £20,000 in rent during the next 12 months.
