6^th Aug 2018

A UK estate and letting agency is warning all landlords and BTL investors that they should be aware of an increase in rental arrears as wage rises, if any, are not keeping up with rent increases.

The firm's latest survey has uncovered worrying figures that between January and April there has been a steadily increasing number of tenants falling into rental arrears. The estate and agency chain also claims that the percentage of their tenants falling behind with rent during this period, rose from 8.4% up to 9.4%.

The agency is not the only one experiencing this problem with their tenants, as a franchise chain of agents' state 20% of its branches had 4 out of 10 tenants in rental arrears in the first four months of this year.

Another industry firm reports that landlords are losing around £900 million each year in rental arrears. This is only one of a set of problems befalling landlords who have to cope with tax regulations and to help compensate they are raising rents, causing more tenants to fall into arrears.

Founder and chief executive of the online portal, Mike Georgeson, re-emphasises that landlords, for safety's sake, must carry out full and comprehensive checks on all prospective tenants rather than fall prey to 'rogues', and said "Rent arrears are a real and serious issue for the nation’s landlords and they need to do everything in their power to protect themselves from being seriously affected. Many industry commentators predict that rents could rise as a result of the incoming ban on tenant fees. Landlords need to be aware of how this could impact on rent arrears and prepare accordingly. One of the most crucial processes for landlords, therefore, is to carry out comprehensive checks on prospective tenants. Making sure you let to tenants who have been fully referenced and credit checked is absolutely vital."

He added: "Making it a formality for rent payments to be included in credit scores is key to securing the financial future of the next generation."

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