In Focus Commercial Credit Rents remain still
Rents stay static during the first quarter of 2020 but the second will reflect impact of coronavirus on market
Paul Fryers Managing director, Zephyr Homeloans
UK tenants paid average monthly rents of £775 during the first quarter 2020, an increase of just £2 or 0.26% on the fourth quarter of 2019, according to The Deposit Protection Service (DPS). According to its most recent Rent Index,
London remained the most expensive place in the UK to rent, with monthly rents unchanged from the fourth quarter of 2019 at £1,345, representing 42% of tenants’ average wages. The figures cover the period immediately
before the Covid-19 pandemic began to seriously disrupt life in England and Wales, and the DPS said that the next set of figures were likely to be affected by the UK’s government’s advice that people should not move house and other policies, such as the prevention of evictions. Matt Trevett, managing director at the
DPS, said: “Despite the stability of the rental market over the past 12 to 18 months, it is likely we will see a very different pattern in second quarter of 2020 owing to the impact of coronavirus on landlords, letting agents, and tenants although it is difficult to predict the long-term effect this will have on the industry. “For example, some landlords are ask-
ing for advice on how to make a claim against a deposit if a tenant leaves without giving notice or how to perform check-in
and check-out reports during the lockdown. “Whether you are a tenant with sudden
financial difficulties or a landlord facing changes to your income, we encourage you to communicate with one another as often as possible during this challenging time.”
Ongoing communication between landlord and lender is key to understanding each other’s situations
July 2020
Payment holiday Under the mortgage payment-holiday scheme announced by the chancellor on 17 March, eligible buy-to-let landlords may apply to defer their loan payments if they cannot make their mortgage obligations because their tenant is unable to pay rent as a result of coronavirus, causing financial hardship. Ongoing communication between
landlord and lender is key to understanding each other’s situations.
Across the country Outside London average monthly rents for
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the first quarter of 2020 were £679, a £7 (1.04%) increase since the fourth quarter of 2019. The North East remains the cheapest
place to rent, with tenants paying £517 per month or 23% of their salaries during the first quarter of 2020. Northern Ireland experienced the largest
monthly fall (4.93%) in rents during the last quarter, from £548 to £521. Year-on-year (first quarter of 2019 to
first quarter of 2020) rents across the UK increased £18 (2.38%) from £757. Rents for detached properties increased
by £9 (0.9%) a month to £1,007 during first quarter of 2020 and rents for terraced properties decreased by £3 (-0.41%) a month to £725, it added. Across the UK, the annual average
proportion of monthly wages spent on rent during the first quarter of 2020 remained around 31%. CCR
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