A new survey has revealed the scale of financial losses incurred by landlords during the early period of the pandemic.
The study of 560 UK landlords by Simply Business shows some 47 per cent have already lost between £2,001 and £10,000 directly because of the pandemic.
Just over one in five of landlords plan on selling property to cover Covid-created problems, mostly the fact that 51 per cent of have lost rental income.
Just over a quarter of tenants have run up arrears and 25 per cent of landlords have been forced to dive into their savings to make up for the shortfall in income. Nearly one in three say it will take six months to two years to recover the losses.
Only eight per cent of landlords say they have been in a position to expand their portfolios during the pandemic; only another seven per cent say they are likely to buy in the coming months, despite a widespread belief that properties will continue to rise in price.
Meanwhile, nearly a quarter of landlords are deterred from expanding their portfolios by uncertainties about the rental market; on top of all that, some 35 per cent of landlords fear further regulation.
Alan Thomas, the Simply Business UK chief executive, comments: “The impact of the pandemic has been felt across all corners of the country and that’s no different for the 2.6m landlords who let out residential properties in the UK. The extent of that impact is made clear in our latest research, with many landlords losing out on thousands of pounds in rental income.
“So it comes as no surprise that a fifth of landlords are planning to sell property as a direct result of Covid-19. Contributing over £16 billion annually in pre-tax spending, an exodus of smaller landlords from the buy to let market could have a devastating impact on the UK economy. But more than this, landlords are crucial to our communities, offering much-needed accommodation to over 4.4m households.
“Thankfully, for the most part landlords remain resilient – 59% of landlords still think property is a worthwhile investment, while almost a third are optimistic about their future letting property.
“Insuring over 300,000 landlords has given us a unique insight into the impact of Covid-19 on this audience. And now more than ever – as the UK looks to recover from the effects of the pandemic – it’s vital that we recognise their significant contribution to the economy, and the important role they play in providing safe and affordable housing in our towns and cities.”
You can see more details of the report here.