The number of tenants seriously behind on rent has risen by 13.8% on a quarterly basis, according to the latest Tenant Arrears Tracker by estate agency chains Your Move and Reeds Rains.
There are now 84,200 tenants more than two months behind with paying their rent, as of Q3 2015, compared to 74,000 in the second quarter. In absolute terms this represents a quarterly increase of 10,200 additional households in potentially serious financial difficulties. On an annual basis, this means 13,200 more households are in significant arrears than a year ago, or an annual increase of 18.6% since Q3 2014, when this figure previously stood at 71,000 across the UK.
However, the number of tenancies in serious rent arrears remains considerably below the record 116,600 such cases seen in Q3 2012. However the latest figures for Q3 2015 represent the highest levels in more than two years.
As a proportion of all private tenancies, just 1.6% are in serious arrears of more than two months, as of Q3 2015. This compares to a peak proportion of 2.9% of tenants in Q1 2008. However this proportion has also increased marginally from 1.4% in serious arrears as of Q2 2015.
Adrian Gill, director of estate agents Your Move and Reeds Rains, said: “The chance of an individual tenant falling into serious arrears remains very low. In general, renting works for most people. Over the last decade the private rented sector has expanded at an unprecedented pace, providing homes for millions of households at the same time as absorbing the worst financial crisis in living memory.
“In the current climate, optimism feels increasingly reasonable. Most households are beginning to earn more, the cost of living is stable and the chance of falling into unemployment is diminishing. For the majority of tenants, paying the rent is becoming easier rather than harder.
“But beneath this rising tide there are inevitably some households and individuals who are not yet feeling any new economic buoyancy. As others bid rents higher there will be a minority who are still struggling to keep up. Landlords and tenants have a mutual responsibility to be aware of this small but significant risk.”