Surge in Unpaid Rental Arrears says Industry supplier

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unpaid rental arrears on the increase
Data released from Reposit, a deposit alternative service, reveals what it calls “a concerning surge in rent arrears” during the final quarter of last year as the economic climate took its toll on tenants.The data reveals an uptick in the value of typical rent arrears claims from October’s £1,344 to  £2,108 in November, and maintaining high levels at £1,954 in December. Concurrently, the percentage of tenancies concluding with arrears rose from 13.7 per cent in September and October to 15.8 per cent in the subsequent two months.Rent arrears claims were also 50 per cent higher in December 2023 when compared to 2022, despite there being just a four per cent increase in rental price between the same time period.

This spike in rent arrears corresponds with broader economic trends, including increases observed in defaults on mortgages and credit cards during the same period. Evidently, the escalating cost of living is taking a toll on tenants, impacting their ability to meet financial obligations.Reposit chief executive Ben Grech says: “The increase is obviously reflective of tough times for tenants, but this naturally has a knock-on effect for landlords, who are facing their own challenges with the Renters Reform Bill and higher mortgage rates.”Dealing with unpaid rental arrears is one of the downsides of being a Landlord in the modern world.

Landlords very often are painted as the bad guys which is far from the truth. They help provides homes for people and their families.

Not paying rent is almost considered a bit of a joke for some, such is the state of society at the moment.

Unpaid Rental Arrears – What can Landlords do?

It is always advisable to communicate with your the tenant and if this brings no success, serve the correct notices. Evicting a tenant should be done correctly and within the confines of the law.

There are clear differences between the can’t pay and won’t pays. Many unscrupulous individuals chose to not pay rent during the pandemic.

There are also cases such as the students who went on rent strike, leaving millions unpaid in student rent arrears.

If a Tenant has vacated with unpaid rental arrears, it is often wise to act to recover them especially if they have the means to pay back what they owe.

There are a number of reliable Debt Collection for Landlords services that operate in the UK. It is always advisable to have realistic expectations when it comes to dealing with unpaid rental arrears.

If the ex-tenant has little means of income or is surviving off benefits, it may be a matter of principle to act more than monetary.

However, if the tenant is employed and has a steady income, then it is reasonable to seek to recover what is owed and certainly cost effective.

The debt collection recovery rate for rental arrears is often much lower than most other sectors.

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