Tenants in arrears as UK rents rise 4.2% in a year
According to the latest Buy-to-Let Index from LSL Property Services, rents in March reversed what was a four-month downward trend, with rents rising for the first time in October 2012.
This increase in rents coupled with the strains of high inflation, general rises in prices and stagnating incomes is putting a strain on tenant finances.
The report highlighted that the total amount of rent late or unpaid has worsened to levels not seen since December 2012, traditionally an expensive month.
Total arrears in March this year were £284m, rising £36m from £248m in February. This equates to 8.5% of all rent across England and Wales, compared to 7.4% of all rent in February.
The average rent in England and Wales rose by 0.5%, to £735 per month this February and 4.2% in March than a year ago, compared to 3.3% annual growth in February.
Unsurprisingly, the strongest growth was in London where a 1.3% monthly rise took rents in the capital to a fresh record, averaging £1,106 per month. Across the country, rents were higher in six out of 10 regions.
David Brown, commercial director of LSL Property Services, said: “Sadly, more people seem to be struggling again. After an initial recovery from December’s financial woes, March looks like an unfortunate regression, and it highlights just how strained many budgets are.
“Economists are forecasting some improvements in real earnings this year, but that will take time, and won’t be universal.
“This month’s renewed dilemma demonstrates even further how landlords need to seek expert advice, and work together with tenants when things start to go wrong. An honest and imaginative approach can provide the best solution, but communication channels must always be kept open, and potential problems voiced at the earliest opportunity.”