Coronavirus: Demand from renters slumps amid lockdown
Tenants are staying put amid the coronavirus lockdown, but analysis suggests they will start moving again soon after restrictions are lifted.
Renting from a private landlord gives some flexibility in normal times, but restrictions have made viewings and moving family belongings impossible.
Rental demand is 42% down since the start of March, according to research by property portal Zoopla.
Demand from buyers fell faster and could face a longer-term slowdown.
Buyers v renters
Buyers deserted the housing market for obvious reasons just before and after the introduction of virus restrictions, which began on 23 March.
This led to a 70% drop in buyer demand over the course of a few weeks.
There was an immediate 57% drop in demand from renters too, according to Zoopla research. There has been a rebound since the start of April.
However, overall, its research suggests rental demand is still 42% lower now than at the start of March.
The long-term impact of the financial crisis, coupled with the coronavirus outbreak, may see a slowdown in demand in the housing market as a whole if jobs and incomes continue to be affected.
However, Zoopla suggested that “some tenants are already mapping out their next move”.
“The flexibility of the rental market is one of the key factors which has allowed activity to bounce back more quickly than other parts of the property market,” said Gráinne Gilmore, head of research at Zoopla.
Rents ‘still likely to rise’
The latter half of the year is generally the busier time for rental activity, which could coincide with looser virus-related restrictions.
However, even after a rebound, Zoopla estimates that the number of moves among tenants would be 25% lower in 2020 than last year.
Ms Gilmore added that rents were likely to continue to get more expensive, but only slightly, over the course of the year.
Tenants have been urged to continue paying their rent during the current crisis, unless they have come to an agreement with their landlord to defer payment after a sudden drop or disappearance of income.
Landlords themselves can request a mortgage holiday from their lender.