Almost half (46%) of landlords reduced monthly rent payments for their tenants because of the pandemic, according to research from Shawbrook Bank.
In total, Shawbrook found that 28% of landlords gave their tenants a full rent payment holiday; a period of up to three months where tenants were not liable to pay any rent.
Additionally, 18% offered a rent reduction; a period where tenants paid a lower level of rent as agreed with their landlord.
Voids hit lowest level since August 2019
On average, rental payment holidays lasted for three months, compared to rent reductions which lasted four months.
Those landlords that gave their tenants a payment holiday estimated they lost £7,500 on average, while rent holidays cost landlords £6,500 on average.
More than a third of landlords who gave a form of rent reduction said that they proactively offered it to their tenant, while a further 45% said it was a mutual decision.
Concerns around furlough, job security and redundancy were all common reasons why a rent reduction or payment holiday was suggested.
Portfolio landlords – those owning four or more properties – were more likely to have agreed a rent reduction with their tenants compared to single property landlords.
Some 17% of portfolio landlords admitted to missing out on income compared to just 12% of single property landlords.
The majority (59%) of landlords who gave rent reductions did this for more than one of their properties.
Shawbrook Bank surveyed 1,000 landlords, including 150 portfolio landlords, and 1,000 private tenants on their property portfolio and rental situation respectively.
John Eastgate, managing director of property finance at Shawbrook Bank, said: “No amount of foresight could have prepared landlords, or tenants, for the impact of the pandemic.
“During this incredibly difficult period, landlords acted pragmatically, recognising the additional strain their tenants were under.
“In fact, in many cases landlords were initiating the conversation around cutting rents to ease their financial burden.
“This period has clearly underlined the critically important role that the private rental sector is playing, and will continue to play, in the UK housing market.
“Responsible landlords have shown their reliability during a crisis, understanding the changing needs of their tenants and acting quickly.
“Solid fundamentals will underpin the market going forward, landlords and investors should look to a positive future.
“There is a strong argument to suggest that landlords in regional locations have never been in a better position to profit, while city centres will continue to represent good value as workers head back to the office, even if it is on a part-time basis.”