Q1 2016 - Tenant Arrear Tracker

Posted 15/06/2016 by: Reeds Rains Press Office

Better tenant finances leads to fewer buy to let mortgage arrears for landlords 

  • Just 1% of UK renters face serious arrears – 86,200 tenant households compared to 89,300 in Q4
  • Landlords benefit from healthier tenant finances – with fewest buy-to-let mortgage arrears since 2007

The number of tenants more than two months behind with rent has fallen by 16% since the eve of the financial crisis and recession in Q2 2008 – from 102,900 in Q2 2008 to today’s total of 86,200. This is despite the expansion, over exactly the same period. At the start of this period, there were 3.6 million households living in the UK private rented sector.  Now, after just eight years, this has grown by 62% to reach a total of 5.8 million households as of Q1 2016.

Adrian Gill, director of estate agents Reeds Rains comments adds: “The massive growth in the number of homes available to rent – driven by both deliberate landlords and accidental landlords coming into the market – has ensured that rents have not outpaced the ability of tenants to pay.

“The affordability of renting and the number of tenants falling behind on rent also needs to be seen within the context of the rapid expansion of the private rented sector and the addition of millions of extra houses and flats to rent.”

Landlords themselves are now less likely to fall behind on their mortgage repayments, with Q1 2016 seeing only 9,300 cases of buy-to-let mortgage arrears of more than three months. Despite significant growth in the number of existing buy-to-let mortgages, the number of landlords in arrears has not been lower since Q4 2007 when there were just 7,500 cases across the UK. On a quarterly basis, the latest total represents a drop of almost a tenth (down 9.7%) since Q4, when 10,300 landlord mortgages were in arrears.