Landlords Could Be Given A Mortgage Holiday Because Of Coronavirus. What About Their Tenants?

While some tenants could face job losses or reduced salary because of coronavirus, their landlords could be granted a mortgage holiday.
Landlords could have access to mortgage holidays amid the coronavirus outbreak, but the situation for renters is unclear.
Landlords could have access to mortgage holidays amid the coronavirus outbreak, but the situation for renters is unclear.
Ben Birchall - PA Images via Getty Images

Updated: See the latest stories on the coronavirus outbreak.

The coronavirus outbreak isn’t just affecting our health – it’s limiting our ability to work and in turn maintain financial stability.

As the the prospect of social-distancing measures loom, with sporting events already called off, increasing self isolation, and a possible ban on mass gatherings, more people – particularly those who rely on gig-economy jobs – face a lack of work and little pay.

The threat posed by Covid-19 could in many cases amount to homelessness, with rent often one of the average tenant’s biggest monthly outgoings (the average UK rent ranged between £535 a month in the North East in 2019 and £1694 the same year in Greater London).

Some of the country’s biggest banks announced earlier this week that they would be willing to help borrowers, including people with mortgages, if they were unable to make a repayment as a result of stalling income amid the Covid–19 crisis.

RBS, Lloyds, and TSB all said they would consider requests for help on a case-by-case basis, including from people with buy-to-let mortgages.

Some borrowers on tracker mortgages, which account for around 11% of all outstanding mortgages in the UK, have already been given a boost by falling interest rates which meant their monthly repayments fell overnight.

But whilst assurances such as these have started to be introduced for property owners, these offers of help are of little comfort to renters who are already often in a more economically precarious position than their landlords.

A spokesperson for renter’s union ACORN said: “In a society in which there is an enormous imbalance of power when it comes to property, between landlords and tenants (due to the economic relationship between them), it is disgusting for landlords to be afforded a mortgage holiday while (overwhelmingly more vulnerable and precarious) tenants continue to have to pay rent.”

Amid uncertainty fuelled by the pandemic, ACORN have set up a petition entitled ‘Protect Renters Now’, with more than 5,000 signatories calling upon PM Boris Johnson to enact a number of measures to prevent renters who can’t pay from being evicted.

These include enacting temporary rent freezes, an emergency freeze on all current section 21 or section eight evictions, and a temporary ban on evictions of housing association and council tenants.

When asked what assurances the government could give renters that they wouldn’t be made homeless as a result of the Covid-19 outbreak, and what plans were in place to help struggling tenants, a government spokesperson said: “The government has always been clear that our priority is to put people first, which is why there is support in place to help affected people and minimise any social and economic disruption.

“We’ve announced a range of measures to support people and communities, including a £500m fund for households experiencing financial hardship and ensuring statutory sick pay is available from the first day people take off work.”

In 2017, the UK collectively paid £50b in rent. With these figures in mind, if the entirety of the £500m hardship fund was donated to tenants, it wouldn’t even cover a week’s worth of collective rent paid nationally.

Statutory sick pay is just £94.25 a week, which equates to £377 a month – more than £150 short of the average cheapest rent in the North East in 2019.

Polly Neate, chief executive of Shelter, said: “The situation with coronavirus is serious and developing daily. While the country faces unprecedented times, we’re asking landlords to be sensitive to any tenants affected by coronavirus or self-isolating who could lose out on income and temporarily struggle with their rent.

“If you’re a tenant who is having trouble keeping up with your rent payments because of coronavirus you should speak to your landlord or letting agent as soon as possible, as they may be willing to agree a repayment plan.

“Some people may also be able to claim benefits like universal credit to help with housing costs, so if you’re struggling don’t be afraid to ask for help and find out your options. Paying off rent arrears should be a top priority before any other non-urgent debts.

The Residential Landlords Association, which represents more than 40,000 members nationwide, said it had issued guidance to landlords with tenants who might face difficulties with meeting rent payments

A spokesperson said: “The RLA has published guidance on its website for landlords who have tenants facing difficulties meeting rent payments as a result of a drop in income if they are off work due to the corona virus.

“In such cases it is essential that tenants inform their landlord at the earliest opportunity. Landlords should be sympathetic and be as flexible as possible with payment arrangements including working with the tenant to repay any arrears when things return to normal. The circumstances of the landlord and the tenant will be different in every case and we do not recommend one solution to all landlords and tenancies.

“Landlords with vulnerable tenants, such as the elderly, are asked to check that they have access to support and consider what steps they could take to help, such as arranging for a shopping delivery.

“Where rent arrears creates problems for landlords with their mortgage repayments we would hope that lenders give landlords the same flexibility with payment holidays that they are offering to home owners.”


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