Looking at the private rented sector: views from landlords and tenants
A new survey is providing insight into the private rented sector. It sheds light on landlord and tenant relationships and the impact of legislative changes and government support on the sector. The private rented sector sentiment survey by deposit protection service mydeposits and deposit replacement membership Ome illustrates a well-rounded view of the private rented sector. The survey received over 14,200 responses from landlords, tenants and agents. The survey asked about relationships between tenants and landlords, industry challenges and the impact of COVID-19, new regulation and government support.
Ome and mydeposits hope the survey results provide insights into common themes, trends and potential issues, showing ways the sector can improve. Relationships between landlords and tenants The relationship between landlords and tenants is often illustrated as frosty. However, this survey reveals a much more positive picture. In the survey, tenants rated their relationship with their landlords 7.4 out of 10 on average. Additionally, landlords and agents also feel positive about their relationship with their tenants.
Interestingly, 30% rated the relationship a 9 out of 10, while 29% rated it 10 out of 10. More than 88% chose a 7 or above. Matthew Hooker, co-founder of Ome, says: “The results of the survey have highlighted the strengths of market and reinforces that the vast majority of tenant-landlord relationships remain positive.” While rent arrears has been a concern, the majority of tenants have been paying full rent as normal throughout the COVID-19 pandemic. And an overwhelming majority of landlords and tenants have been working together throughout the crisis.
In the survey, 95% of tenants said they are not in rent arrears due to the pandemic. Of those struggling, 58% said their landlord had been accommodating. And 31% said their landlords offered reduced rent or a rent holiday. The impact of legislation and regulation changes The survey also asked landlords to comment on the worst things they faced in the private rented sector. The top two responses were legislation and regulation with about 24% of the respondents and non-paying tenants with approximately 14%.
Landlords also shared the most common challenges in the private rented sector. About 65% of landlords stated they feel the industry has changed for the worst. And this is predominately due to the increase in legislation, regulation and tax. Despite this, 79% of landlords said they believe they would still be a landlord in five years’ time. This shows that being a buy-to-let landlord may be perceived as more onerous with recent legislative and tax changes. However, many still consider it a profitable and worthwhile endeavour.
Suzy Hershman, head of dispute resolution at mydeposits, explains: “In spite of challenges faced including legislation, rent arrears, and evicting tenants, it is evident that the majority of landlords want to remain in the sector because it provides a good source of income and an investment for retirement, making it a worthwhile endeavour. “From a tenant’s perspective, the cost of renting is a key factor for those with a negative outlook of the sector. It could be suggested that the high costs and affordability issues felt by tenants manifest as rent arrears for agents and landlords making the problem cyclical.
However, renting is also providing a solution to those who cannot afford to buy whilst offering flexibility.” Government support for the private rented sector Throughout COVID-19 and successive lockdowns, there have been recessions and redundancies, leading to an increased need for government support. Financial support, such as the furlough scheme and self-employment scheme, have been a lifeline for some. In the property industry, many have voiced their concerns that there should be more help for tenants in rent arrears.
Over half of tenants revealed they either felt not very supported or not supported at all by the government. Additionally, 90% of landlords believe the private rented sector is not supported by the government. Matthew Hooker concludes: “As we emerge from the pandemic and the Government gets back on track with making further changes to the landscape of the private rented sector, our sentiment surveys will provide valuable insight into the views of landlords, tenants and agents and what changes could have a positive impact on reducing the challenges faced by all parties.