Furlough scheme extension announced in spring Budget

In yesterday’s Budget announcement, Chancellor Rishi Sunak announced the furlough scheme will be extended until September 2021.

Neil Cobbold, Chief Sales Officer at PayProp, comments on this news: “(Yesterday’s) Budget once again focused on the Government’s financial support in response to the COVID-19 pandemic. The most significant headline announcement for the private rented sector in the short term – an extension of the furlough scheme until the end of September – will provide additional support for many tenants.

“The furlough extension will indirectly safeguard the finances of landlords and letting agencies by helping to keep rent arrears under control in the short term.

“However, when the furlough scheme does come to an end, there could be a significant number of redundancies which could put additional pressure on many tenants’ ability to pay rent.

“There were rumours that rent grants for tenants in England – similar to those introduced in Scotland and Wales – were being considered by the Chancellor, but this additional support hasn’t materialised and the sector could now face a cliff-edge in a few months.

Ben Beadle, Chief Executive of the National Residential Landlords Association (NRLA), said: “The Chancellor’s pledge to do whatever it takes to support those affected by the pandemic will ring hollow for thousands of tenants and landlords across the country.

“The Government has admitted that private tenants have been hardest hit by the pandemic, and figures show that most of those in arrears are unable to access emergency housing support from local authorities.  

“Despite this the Chancellor has failed to provide the sector with the financial support needed to pay off rent debts built as a consequence of the virus. 

“Without help to get arrears cleared, many tenants face the prospect of losing their homes and having damaged credit scores, which will undermine the Government’s efforts to help generation rent become generation buy.”

Robert Nichols, CEO of Portico, comments: “It is also very welcome news that the furlough scheme has been extended, as well as the uplift to Universal Credit. These moves combined will continue to provide some much needed confidence in such extraordinary times and, together with the Stamp Duty holiday and the new mortgage guarantee scheme, buyers, renters and sellers can rest easier and plan their moves with less to hold them back.”