Tenants in Switzerland, the United States and the Netherlands are facing a huge financial hurdle if left unable to work as a result of the Coronavirus lockdown, with rental costs over just three months spiralling above £3,000, falling to £2,232 across the UK.
Research by Hamilton Fraser’s deposit alternative scheme, Ome, has revealed the rental costs facing tenants across the nations currently worst affected by the Coronavirus outbreak.
With the impact of the pandemic looking likely to last for at least three months based on the UK Government’s buy-to-let mortgage holiday afforded to UK landlords, Ome looked at the average rental cost across the countries suffering the most. Ome then looked at what this would also equate to should a tenant be unable to pay their rent due to lack of income over the space of three months.
The research shows that the cost of renting a one-bedroom apartment in the city centre is at its highest in Switzerland at an average of £1,325 per month; climbing to £3,976 over the space of three months.
The United States is home to the second-largest financial rental hurdle with an average rental cost of £1,168; again climbing to £3,504.
The Netherlands is the only other nation where the average rental cost exceeds £3,000 over three months of lockdown (£3,019), with tenants paying an average of £1,006 per month.
The data shows that the UK sits at number seven with the average monthly rent of £744, meaning a rental shortfall of £2,232 over three months for those unable to generate an income.
Co-founder of Ome, Matthew Hooker, commented: “It really is anyone’s guess at the moment as to how long we will be on lockdown, with many unable to make a living while we are.
Based on the Government’s gesture of a buy-to-let mortgage holiday for UK landlords we’re looking at at least three months, although based on the extent of the damage in China, we could be looking at a lot longer.
For the four and a half million tenants in the UK’s private rental sector, this could pose a real problem with the figures showing a rental shortfall of over two thousand pounds in three months alone.
While some will receive 80% of their wage from the Government, many won’t. Thankfully, we’ve already started to see many, many landlords offering rent holidays and reductions where they themselves can afford to.
I think we’re on the tip of a huge cultural shift and the rental market is bound to see its fair share of changes. Whether in the form of deposits, rent or other day-to-day responsibilities of tenants, I believe providing flexibility to tenants is here to stay.”
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