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Rental property arrears fall

Rental property arrears fall

Category: Buy To Let

Updated: 03/01/2013
First Published: 03/01/2013

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Fewer tenants fell behind with their rental payments in the final quarter of last year, despite high rental costs and inflation.

During quarter four of 2012, the number of tenants in severe arrears of two months or more fell by 15.6% compared with the previous quarter, to 86,000. This is the lowest level since quarter four in 2011.

In contrast to the fall in arrears, the level of tenants facing court order evictions rose during quarter three of last year. A total of 25,756 tenants faced the grim prospect of eviction, reflecting a 5.5% quarterly rise.

Annually the number of rental eviction notices increased by 0.25% from 2011.

Demand for rental accommodation has grown significantly over the past couple of years as a result of continued tough conditions in the housing and mortgage market.

A lack of competitive rates and high loan-to-value mortgage deals has alienated many prospective buyers, particularly those buying for the first-time, from purchasing homes.

David Brown, commercial director of LSL Property Services who conducted the research, said: "Thankfully strong tenant demand and yields are tempting more people to invest in the sector and existing landlords to expand their portfolios.

"But investors should place financial suitability of any prospective tenant high up their agenda when letting a property."

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