With rent arrears on the rise, the National Landlords Association has issued a warning for landlords. The warning is for landlords to ensure that they are suitably covered in the event of their tenants not paying rent.
The reminder for landlords comes after research from the NLA suggests that nearly four in ten landlords have been the victims of rent arrears within the last year. That accounted for an average of £1,943 being owed by tenants.[1]
In addition, the findings show a staggering 89% of landlords do not take out any kind of insurance policy to cover themselves in the event of experiencing rent arrears. These policies do, in general, cover landlords against lack of rent payment and for legal fees required to chase unpaid money.
Only 23% of landlords said they were in receipt of rent cover.[1]
Stressful and costly
The chairman of the NLA, Carolyn Uphill, emphasised the need for landlords to be vigilant. She said, ‘Most landlords will be affected by rent arrears at some point and there are many different reasons why tenants could find themselves with difficulties over meeting their rental obligations.
“It’s important to be prepared as the amount of money lost through arrears can roll into tens of thousands of pounds in the worst cases. It can also be a very stressful and costly process to regain possession and claim any unpaid monies through the courts.[2]”
Rising problem
Figures released from financial capability organisation The Money Charity indicate the growing problem of rent arrears and underline the need for vigilance from landlords. The latest debt recordings released from the charity suggests that there has been a rise in landlords claiming against their tenants in courtrooms throughout England and Wales.
CEO of The Money Charity, Michelle Highman, said that, ‘many people feel trapped in the rental sector,’ due to the, ‘high level of rents they are forced to pay.[2]’ She went onto say that the, ‘increasing numbers are unable to even sustain their rental payments is particularly worrying.[2]”
[1] http://www.landlords.org.uk/news-campaigns/news/dont-take-risk-rental-income-warns-nla
[2] http://www.landlordtoday.co.uk/news_features/%E2%80%9CDon%E2%80%99t-take-the-risk-with-rental-income%E2%80%9D-warns-NLA