Rental payment delays ‘are creeping up month-on-mon...

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05 June 2020

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Rental payment delays ‘are creeping up month-on-month’

There has been a notable increase in the number of rental properties now making late rent payments, according to a survey of letting agencies covering 16,000 UK properties.

The research, conducted by property technology company Goodlord, found that 6.59% of private rented households are now making late payments.

Prior to the lockdown, agents recorded late payment behaviour for 4% of properties on average.

Between 21 March and 21 April, an increase was reported in late payment behaviour; almost 2% more properties owed rent after seven days, an increase from 4% to 5.85%.

Between 21 April and 21 May, the number of late rent payments increased from 5.85% to 6.59%, a proportional increase of 13% month-on-month.

Tom Mundy, COO of Goodlord, commented: “Instances of payment delays are creeping up month-on-month as the economy and livelihoods are affected by the pandemic.”

The number of tenants who have agreed to some form of rent reduction or payment plan has increased by 22% since the first sample was taken, up from 2.82% to 3.43% of properties.

Mundy added: “While the numbers aren’t insignificant, we’re also seeing a lot of positive activity on the agent and landlord side to create payment plans and offer flexibility to help tenants who are struggling - on the whole, there’s a huge amount of empathy on all sides and a desire to resolve issues constructively.

“A key area that does still need addressing however is confusion amongst tenants on paying rent whilst evictions are paused - agents are reporting that many tenants have misinterpreted these rules and some have been requesting payment breaks despite no change to their circumstances. This ongoing confusion is damaging for everyone involved.

“We predict a lot more activity in the market over the coming months, as tenants move in line with changed circumstances and those on course for long-term home working taking the chance to move to a new area. And we predict rental defaults to continue at above-average levels for every month restrictions are in place.

“However, the wider uptick in market activity for the rental sector is cause for optimism.”

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