Fear thousands of tenants will now fail referencing

Tenants with arrears accumulated during the pandemic are finding it tough to secure alternative accommodation because their credit scores have been impacted.

The National Residential Landlords Association calculates that as many as 210,000 renters are in this position,

The association says that with emergency restrictions easing from today, its survey of some 2,000 private tenants suggest that seven per cent have built up arrears since the start of the pandemic 15 months ago.

A quarter of those with arrears say their landlord has attempted to reclaim these by seeking a court order. Such orders, where successful, damage a tenant’s credit score – an outcome which makes it for harder for them to access new housing in the future.

The data, compiled by research consultancy Dynata for the NRLA, shows that the average amount of rent owed by those in arrears which started during the pandemic is approaching £900. Around 30 per cent of those who are presently in arrears now owe £1,000 or more.

The association also suggests over 80 per cent of those renters now in arrears were not in arrears at the start of the pandemic.

The association says the majority of tenants in arrears do not qualify for emergency housing support provided by councils to help those in receipt of benefits. 

The government has also frozen housing benefit rates in cash terms, a policy the Institute for Fiscal Studies has branded as “arbitrary and unfair.”

NRLA chief executive Ben Beadle says: “As the private rented sector moves out of lockdown measures, the Chancellor has failed to provide tenants with the support they need. This is especially the case for the majority of those in rent arrears who do not qualify for benefit support.

“Without urgent assistance, many tenants face the prospect of losing their home needlessly as landlords struggle to shoulder the cost of arrears. Affected tenants also potentially face the negative impact of damage to their credit scores.

“The government needs to develop a financial package which ensures that benefits cover the rents of those in receipt of them. For those who do not qualify for benefit support, an interest free, government guaranteed tenant hardship loan should be established, similar to those in Wales and Scotland.”

Written by: Houseladder