More than half of landlords have experienced late rent payments in the past year, and cuts to housing benefit are expected to put further pressure on tenants.
Research by the National Landlords Association has found that 52% of landlords have reported rent arrears in the past 12 months.
The survey of nearly 600 landlords found the average late-payer owed £730 in late rental payments. The research also found that 62% of landlords believe running a lettings business is becoming more difficult.
David Salusbury, NLA chairman, said: “It is concerning that more than half of landlords have received late rent payments or no rent at all in the past year. The government cuts to housing benefits will only put further pressure on tenants who are struggling to pay the rent on time.
“Landlords are unable to absorb this cost of rent arrears long term as they have their own financial commitments such as mortgage repayments, which could increase further with the predicted rise in interest rates.
“Well over half of landlords also believe running a lettings business has become harder recently.”
He suggested that landlords should take out rent guarantee insurance. Although costly, it typically covers up to £2,500 per month for unpaid rent.
The lettings giant LSL has also found rental arrears climbing: see next story.
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Comments
I had a tenant for 2 years who started to default after 18 months, first being late, then only part payment and so on. As this is part of my retirement pension, I got into a difficult position late last year. Consulting a solicitor I was made aware that the Agreement had been wrongly filled in by the letting agent and legally I would not have been able to get her out of the flat until 2012. I almost freaked. I needed to use all my understanding, tact and persuasion for her to agree to move, and luckily her grown children helped pay off the arrears. After spending £2000 to get the flat back in good order I now have new tenants who seem very happy. Its certainly a tricky time for landlords.
We have nine rental properties - some families, some students. We have had arrears in both, but we do our own management and we chase up arrears in every case and so far have recovered over 90% of monies owed to us. You have to be single-minded and not give up on recovering the money - it can be done. But I agree that the whole business of letting property is hard work and likely to get harder. It's no job for the amateur or the faint-hearted.
I have 4 properties. One I have just had a tenant leave after no rent for 25 months and despite court proceedings owing me £17.5K in rent and £15K in legal fees; also the property needs a full clean (no cleaning done in 28 months) plus redecoration and new carpets (disgusting). In the second the tenant left owing £420. In the third, i am going through PCOL after rent arrears had reached over £2k, in the fourth, I am owed £2K by an absconding tenant, who left a disaster behind them. Rent payments start to drop away slowly at first, then no rent at all. The legal system needs a major overhaul to support genuine landlords. the way things are going, how can we support this sector!
My tenant vanished with £1800 rent arrears with no trace. I am very angry because he promised to pay the arrears in instalments to my estate agent, but didn't.
I just dont understand, why people do these to their fellow human beings. So I do know what other landlords go through. It is very sad.