Coronavirus and Housing: How does Frome reflect the national picture?

Fair Housing director Polly Lamb looks at the effects of the pandemic on renters and landlords
map of Frome copy

 

Much has been written and speculated about the effect that this global pandemic will have on housing in the UK and elsewhere. The team at Fair Housing for Frome are keen to hear feedback from local people on the subject and held a meeting on Zoom for local landlords to start the ball rolling. 

To reflect on the period since Lockdown began, we have been inviting comment from landlords and letting agents which has delivered a slice of life in Frome from the last 3 months. We spoke with landlords who own multiple properties and some who just own one. We surveyed large and smaller letting agents in the area and even recorded some experiences from commercial landlords and holiday property owners in Frome. 

The wider housing picture

According to the New Economics Foundation (NEF), 35% of renters in the UK live in poverty and 33% of the average renter’s income is spent on rent. This compares to homeowners who only spend an average of 17% of household income on a mortgage indicating that renters are more vulnerable to financial issues from redundancy or the government furlough scheme. 

The government suspended evictions early on in the Corona-crisis and then upgraded the rule to an eviction ban which has now been extended until late August. There was a call from government for landlords to act with ‘compassion’ when dealing with tenants who were struggling to pay rent. 

Prior to Lockdown the UK Collaborative Centre for Housing Evidence (CaCHE) said that ‘Eviction from private renting is the main direct cause of homelessness in the UK today.’ This means that private landlords have a big part to play in how the Covid-19 virus affects UK housing and judging by the temporary eviction ban, the government knows it. 

The ever-widening gap between rich and poor in the country continues to grow during this crisis as house prices fall and investors can go looking for bargains.

Focus on Frome

What we know at Fair Housing for Frome is that in the last couple of weeks there has been a large increase in people registering to join our Facebook page: Frome Housing Notice Board, where people can advertise and also look for homes to rent. Could this increase be because of a threat of eviction or the need to find a place with lower rent?

Regarding rent arrears or late rent payments, the feedback we have gained so far from landlords and letting agents tells of only a minor ripple in the private rented sector locally. However the homeless charity Shelter is predicting an increase in homelessness in the Autumn as the ban to evict is lifted. It’s crucial that Fair Housing for Frome work with relevant bodies to keep up to date and plan for this.

Across our survey responses from letting agents, there was a reported average of only 6% of tenants who had not been able to pay the rent in full over April and May of this year. This compares favourably with the national picture where only 49% of rent was paid on time for the same period. The usual figure for rents being paid on time in the UK is 80-90% according to NEF. 

We asked letting agents how many evictions they expected to see in their portfolio of properties as a result of the Covid-19 crisis and the response was a resounding zero. This was reflective of the general comments the agents made in the survey about how rent problems were being handled. One agent commented “All landlords who have been affected [by a fall in rental income] have been very compassionate and some have even offered to reduce the rent even when tenants haven’t had a drop in income.” Another agent reported “So far we have experienced far less problems than expected and as such won’t be considering any evictions related to the Covid issues. Our tenants have in general been very honest with us and taken assistance as needed through the government. Because of this some people are actually in a better position regarding their rent payments than before this crisis.”

All agents who responded to our survey about the picture during April and May spoke of cooperation between landlords and tenants and a willingness to work around any problems rather than evict. There has been a similar response from the landlords we interviewed. All interviews were carried out on a confidential basis to protect tenants’ privacy. 

The Local Landlord Approach

Landlord A has a range of flats and houses in the town and says that there have been very few problems over the Lockdown. He said that some tenants had requested more time to pay their rent but had already caught up once the government money had come through. He feels that some people are “better off” because they have not been able to go out and spend money. When asked how things might change as a result of the pandemic, he predicted that house prices will rise in rural areas and the trend towards town centre prices rising in Frome will slow as people look for space from one another. 

Landlord B has 3 properties of different sizes in the area. One of her properties houses tenants who have lived there for many years and ran into financial trouble as a result of not being able to get government help because of being recently self-employed. Landlord B offered a reduction of 50% for the period of Lockdown and when the tenants offered to catch up the shortfall later, she said no. She told us that she was able to cope with the reduction in income and wanted to help her long-term tenants out.

Landlord C has 2 Frome properties and he approached his agency to offer his tenants a rent reduction in anticipation of any financial problems they might face during the crisis. Another letting agent spoke of landlords approaching them with similar offers to help tenants. 

Landlord D has a residential let property and some holiday let properties. She said that she was not approached by the council to house any homeless people temporarily as part of the government scheme to ensure all rough sleepers were housed during the pandemic. She was offered the grant from the council to support her holiday let business despite not having applied for it. She used some of it to pay her regular cleaner of the properties what she would have earned had there been the usual bookings. 

It appears that Frome’s private rented sector has been coping well on average from this handful of interviews and small survey which covers approximately 500 properties. Most of the landlords, not mentioned here, who owned one property spoke of not having heard from their tenants and so assumed that all was well. 

But despite the general positive response from this early lockdown research, there remains a hidden level of housing need in Frome. As lockdown eases and unemployment rises, FHfF is planning ahead with other partners to carry out a Housing Need Survey to get a clearer picture of the Covid-19 impact. 

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