A significant number of private rented sector (PRS) tenants are struggling to pay their rent, a financial charity organisation has warned.
According to the Money Charity, growing levels of personal debt is making it hard for individuals to keep up with their payments each month.
The organisation said an increasing number of landlords in England and Wales are issuing court claims against their tenants as a result. It added possession orders have also risen, with close to seven in ten claims – either outright or suspended – ending in an order of some variety.
Michelle Highman, Money Charity chief executive, said the high level of rent in many parts of the country is partially to blame for this problem.
“That increasing numbers are unable to even sustain their rental payments is particularly worrying,” she added.
Research by the Money Charity has revealed personal debt levels in the UK have surpassed the previous peak that was reached in September 2008. The total value of personal debt in the UK now stands at close to £1.4 trillion, it said.
While the Money Charity’s warning is something the letting sector should take note of, it is in contrast to research from LSL Property Services, which found rental arrears fell in October despite average rents continuing to rise.
The organisation revealed the typical rent increased 1.9 per cent year on year to £758 during the month, but the number of tenant arrears dropped to the lowest level recorded since 2008, suggesting renters’ finances may be improving. Total arrears in October amounted to £245 million – 7.1 per cent of all rent.
Commenting on these figures, LSL director David Newnes said: “The fact tenants have paid down late rent to such an extent is testament to the professionalism of landlords, the availability of advice for tenants and the stability of the entire industry.”
He added that renting remains “relatively affordable” despite limited wage growth and low savings levels.
Disclaimer: This article is provided as a guide. Any information should be used for research purposes and not as the base for taking legal action. The Tenants' Voice does not provide legal advice and our content does not constitute a client-solicitor relationship.
We advise all tenants to act respectfully with their landlords and letting agents and seek a peaceful resolution to problems with their rented property. For more information, explore the articles in our category.
If you experience problems with your tenancy deposit, have disrepair in your rented property or suspect that your landlord should have a licence to rent your property but does not have one then you can receive a free consultation by calling our advice service: Call Tenant Assist on 0333 344 3788.
For more ways to reach us, please visit our contacts page.