Leading property firm says landlords have fallen between the cracks as the government has moved to protect both employed and self-employed workers.
Small private landlords should get the same 80% salary guarantee as other workers to help make up for lengthy reductions in rental income, according to a leading asset management firm.
The call follows the recent announcements that employees and the self-employed are to access a scheme that pays 80% of their income up to £2,500 a month for three months, but which misses out landlords who do not fall into either camp.
Spicerhaart Corporate Sales believes mortgage holidays may not go far enough and is calling on the Government to extend its salary guarantee to landlords’ rental income following the news that all evictions will be frozen for at least three months.
“While a blanket freeze on all possessions activity will protect tenants in the short term, it’s bound to lead to an accumulation of arrears that will be all the harder to deal with once the freeze is lifted,” says Managing Director Mark Pilling.
“If there seem to be no consequences to non-payment, some struggling tenants will naturally prioritise other bills, and will be more likely to ignore attempts to communicate with them to manage the situation.
“A three-month ban on possessions activity will result in even longer spells without rental income – possibly six months or more of state-enforced void periods.”
Landlords relying on income from only a small number of properties will find payment holidays on buy-to-let mortgages of limited help, says Pilling, and if one or more of these isn’t generating an income for a long time, it could cause families real financial difficulty.
He adds: “Rental income is subject to income tax – to say nothing of the Stamp Duty premium paid by buy-to-let landlords. It seems only fair that it should be subject to the same Government guarantees as other income affected by the restrictions currently in place.”