Tenants across the UK are showing signs that the austerity measures imposed by the Government in the second half of 2010 are gradually impacting on their purse strings. Their landlords are worried about the consequences of their hardship impacting on them as well.
A survey directed at landlords by the Association of Residential Letting Agents (ARLA) shows that tenants are beginning to get behind with their rental payments. The survey found that 40% of landlords questioned were experiencing some level of trouble getting payment from tenants on time. This compares to 35% over the previous 6 months and in fact is the first time the rate has increased for 18 months.
Ian Potter, an operations manager at ARLA, was not surprised at the figures explaining “At the beginning of last year, we predicted that the number of tenants having difficulties paying rent would increase and unfortunately, this seems to be the case.” He went to say that the most likely reason for the upturn in tenants struggling to pay their rent was down to job losses and pay cuts.
The survey follows hot on the heels of another survey by an online property services company which revealed that rents and rent arrears were both on the increase. Strangely enough tenants in London who have seen their rents rise inexorably over the last 10 months appear to be dealing with the increases better than their counterparts in the rest of the country, as rental arrears in the capital have stayed at roughly the same level.
Insurance companies offering landlord insurance have experienced an increase in interest about their products over the last 12 months as residential landlords become keen to protect their investment as the demand on the private rental sector grows.