60% of Private Landlords owed rent arrears

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landlord owed rent arrears

Data from the National Residential Landlords Association has revealed that a massive 60% of Private Landlords are owed money due to rent arrears.

Roughly 840,000 tenants in the Uk have fallen into arrears according to data from the National Residential Landlords Association (NRLA)

The NRLA says with currently no eviction action possible against them, accrued debts are increasing. Many of which will get to the point where there is little hope of the tenants paying them back.

The landlord’s organisation said that 7% of private renters have built up arrears since the pandemic began last March. The average arrears were listed as between £251 -£500. But 18% (approx 150,000) of the rental arrears cases were at £1,000+

One year on from the first ban on the repossession of rented homes, the analysis shows that more tenants are likely to lose their homes in the long term as a result.

On top of this, the damage such debts could have on credit scores will cause tenants difficulties when wanting to move home.

Although most landlords have been working with struggling tenants to help keep them in their homes as far as possible, 60 per cent have lost rental income as a result of the pandemic. 39% of Landlords said private rent arrears were continuing to increase.

The situation for landlords is being made worse by the strains that the courts are now under in hearing the relatively few cases that are being allowed to go ahead. It is taking an average of a year from a private landlord making a claim to repossess a property to it being enforced.

This is despite tenant eviction cases currently being considered by the courts being the most serious including those related to tenant anti-social behaviour and other criminal activity.  and where rent arrears were building before lockdown measures started last year.

With the Government now working to taper down emergency restrictions in the sector, the NRLA is renewing its call for an urgent financial package to pay off rent debts built as a result of the pandemic. The Government guaranteed, interest-free hardship loans should be available for the majority of tenants now in arrears but who do not qualify for benefit support. Grants should be made available for those in receipt of benefits.

It is calling also on the courts to make much better use of technology to ensure that legitimate possession cases can be heard more swiftly. This would make it easier for tenants to attend hearings by video (which currently very few do in person). It should be matched by ensuring they can access legal advice and support much earlier in the process than at present.

Ben Beadle, Chief Executive of the National Residential Landlords Association, said “Whilst many landlords and tenants have worked well in responding to the challenges posed by the pandemic, we are now at a crunch point. As the country follows the roadmap out of lockdown, so too emergency measures in the rental market will need to be eased.”

“Ministers need to ensure the tenants have the financial means to pay off rent debts built as a result of the pandemic. Without this they will have to accept the inevitable consequence of rising homelessness and damaged credit scores.”

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