Growing concern of rental arrears for accidental landlords

November 22, 2013

A recent survey by Northwood has revealed accidental landlords in the South West have experienced more tenant arrears in the last three years than landlords anywhere else in the UK.

Our study reveals the three hotspots for tenant arrears for accidental landlords are the  South West [45%], South East [36%] and the North East [33%].

Nationally, 41% of landlords have experienced rental arrears in the last year[1] and 7.8% of rent is currently late or unpaid.

Accidental landlords are those who rent out their property due to circumstance, rather than choice; it could be due to a change in personal circumstances or as a result of the current housing market.  They now account for 30% of all landlords in the UK, with thousands facing huge financial implications due to rental arrears.

This is clearly an ongoing worry, with 42% of ‘one property’ landlords admitting they are ‘very concerned’ about experiencing tenant arrears at some point over the next two years.

Amanda Chandler, Compliance and Legal Manager at Northwood GB, says: “Rental arrears can pose a huge headache for landlords; it’s time consuming and expensive.  If court action is taken, it can take several months from the time when the tenant stops paying their rent to being evicted – that’s several months without a rental income.  The landlord not only has to pay solicitor and court fees, which can add up to more than £1,000, but often also have to meet monthly mortgage payments during this time.”

Northwood’s Guaranteed Rent service gives landlords the certainty of a fixed rental income even if the property is vacant or the tenant stops paying.

Gemma Goodson, Finance Director at Northwood GB, continues: “Over the past year, we have seen a steady increase in landlords enquiring about Guaranteed Rent as a way to safeguard against the tenant arrears.  The service takes the hassle out of renting and gives them peace of mind.”

Claire Beach, landlord who is signed up with Northwood’s Guaranteed Rent service, says: “Before I signed up with Northwood, I experienced four months of rental arrears.  It was a really worrying time and if it wasn’t for loans from friends and family I wouldn’t have been able keep up with my mortgage payments.  I’d never want to be in that position again.  Signing up to Guaranteed Rent and knowing I’m going to get regular rent payments is the best decision I’ve made; I feel like a weight has been lifted.”

If you are thinking about letting out your home as a rental property, read our guide on how to do this safely >>> here. 

[1] NLA landlord panel 27 March, 2013

[2] LSL Buy to let index, August 2013

Northwood is one of the largest and most recognised lettings agents in the U.K. and the leading supplier of Guaranteed Rent to give landlords complete peace of mind.

Find us on Twitter @northwoodUK or visit our YouTube Channel.


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