Coronavirus Rental Arrears Increased By Just 3%
One of the UK’s largest letting agencies claims that since the start of the Coronavirus pandemic tenants in rental arrears increased from 2% to 5%, and believes that the rise reflects the wider market.
The agency is very relieved that the increase is considerably lower than its initial expectations in the first eight weeks of Covid-19.
The CEO Dorian Gonsalves has said he is confident that the company’s figures are a true reflection because its branches, are spread across the UK, and cover a wide range of the many different housing markets along with all levels of tenant income.
Gonsalves said: “There are a whole bunch of reasons why our rent arrears level is relatively low.” He explains it is relatively low because the agency takes a stringent approach to referencing, and its property management operation continued throughout the lockdown, keeping in constant contact with their landlords and tenants if any issues arose.
He also believes that as the chain is far stronger outside of the capital as on average its tenants are paying £800 per month whereas in London it is around £1,500 per month.
He added: “For example, if you’re earning £1,600 a month from the furlough scheme then in the provinces paying £800 a month isn’t a stretch and that’s why I think our arrears rate has stayed low.”
Gonsalves has recently spoken to the company’s rent guarantee insurance provider who told him that they are seeing a similar rise in rental defaulting in its own business.