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As many as 560,000 tenants are currently in arrears, which is equivalent to more than 10% of all rent due to landlords in the UK.

According to letting agent LSL, 133,000 tenants faced potential eviction for arrears at the end of May, equivalent to one in twenty-five renters. Also, by the end of May, a staggering 557,170 tenants had not paid their rent. One in seven of these were over two months late stumping up what they owe their landlords.

Overall, tenants in England and Wales were behind with the rent by a collective £254m, equivalent to over one ninth or 11.6% of the country’s rent payable that month.

David Brown, commercial director of LSL says: “Tenants on lower rents are most likely to fall behind with their payments. These people are usually in lower paid jobs and have found themselves much more vulnerable to the economic downturn."

Brown says landlords, needing to protect their own livelihoods, often then begin taking steps to remove those unable to keep up with the rent. But eviction is a real last resort – a landlord would far rather have a tenant who is slightly behind with his rent, but who is likely to catch up than face a costly void when no rent is received at all.

Brown adds: "Although the figures look bad, they actually represent an improvement on the picture back in November when the first big waves of job losses in the UK were being felt. At that time, arrears totalled £278m, equivalent to 13.5% of all rents due. At that point 622,000 tenants had fallen behind with their rent at that time and 151,000 faced possible eviction."

Brown says landlords tend to be quite flexible with tenants who begin to fall behind with their rent. Two thirds of those in arrears are less than a month late and most of them quickly get up to speed again. Even among the rest, a large number will not lose their homes: “There has been a large shift in the private rented sector over the past year. Tens of thousands of would-be buyers have accumulated in the rented sector. Frozen out of the housing market by the need for a large deposit, or simply waiting out the housing market downturn, these people generally have good incomes and credit records. They are far less likely to default on their rent and make excellent tenants.

"For landlords the key question is how long this group will wait before buying their own homes.”

SOURCE: LSL, 26/06/09

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