Renters across the country had more problems meeting their financial commitments in the first three months of 2015, according to the latest Tenant Arrears Tracker by estate agency chains Your Move and Reeds Rains. There are now 70,900 tenants facing more than two months of unpaid rent. This is 1,500, or 2.2 per cent) more households […]
Renters across the country had more problems meeting their financial commitments in the first three months of 2015, according to the latest Tenant Arrears Tracker by estate agency chains Your Move and Reeds Rains.
There are now 70,900 tenants facing more than two months of unpaid rent. This is 1,500, or 2.2 per cent) more households than in the previous quarter. Since the same point last year the number of tenancies in such a position has grown by 4.0 per cent, with 2,700 additional households falling into this most serious category of late rent.
Despite the downward trend, the setback is minor considered to previous peaks. The worst peak of serious rent arrears was in the third quarter of 2012, when 116,600 households faced more than two months in late rent. In the first quarter of 2015 that number was only 45,700.
However, progress has now been incremental or even backwards for over eighteen months – with the fourth quarter of 2013 still the best calendar quarter on record, when just 63,500 struggled with serious rent arrears.
Despite a lack of progress since the end of 2013, the chance of a given tenant falling so far behind on rent is extremely low. As a proportion of all tenants, just 1.4 per cent owed more than two months’ rent in the first three months of 2015, the same as in the last quarter of 2014. This compares to 2.9 per cent in the first quarter of 2008 (twice the current proportion) even before the worst of the financial crisis and recession.
Adrian Gill, director of estate agents Your Move and Reeds Rains, comments: “Tenants are now far less likely to be out of work than at this point last year – a low-paid job is clearly better than no job at all, and this has had a massive effect on tenant finances as a whole. But the easy progress from a lower unemployment rate may now have been made.
“Earnings are a crunch point too. Many tenants are still struggling to keep up with household expenses in the face of extremely modest wages. There are some signs on the horizon this will improve, but in the meantime a small but significant minority of households are facing a real challenge to find the rent every month.
“Other factors are at play too. There are also more cases of severe arrears, in absolute terms, because there are more people renting their home overall. The chance of a given tenant failing to pay the rent within a couple of months is extremely low – and falling. The flipside to these figures are that more than 98% never get into serious arrears.”
Eviction rates pick up in response to arrears
Between January and March this year, 28,900 tenants faced a court order for eviction, on a seasonally adjusted basis. This is up 2.3 per cent on the last three months of 2014.
However, compared to the first quarter of last year, eviction orders were down 7.9 per cent.
