The volume of landlords seeking possession and the number of court orders continue to increase, fresh data provided by the government shows.
The figures reveal that there were 103,329 landlord claims in last year that led to an order for possession being made, which is the highest recorded rate over the last five years and represents a continuing upward trend. It is estimated that between 67% and 80% of claims led to a possession order.
The number of cases of private landlords applying for possession using the accelerated procedure is up by 85% over the past three years, indicating the difficulties in chasing rent from defaulting tenants.
Non-payment, late or partial payment of rent remains the biggest worry for landlords – good letting agents are tending to highlight the risks to landlords more, and are putting procedures in place to help protect themselves and the landlord against the nonpayment of rent.
According to the latest Tenant Arrears Tracker by chartered surveyors Templeton LPA the number of tenants in ‘severe financial difficulty’, actually fell in the last quarter of 2012 the lowest figure since the final quarter of 2011, but they warn that property-owners and letting agents need to be more vigilant when screening potential tenants, since it is easier to avoid arrears than it is to recover them.
Michael Portman, managing director of LetRisks, comments: “With the continuing difficult economic situation and job losses in certain parts of the UK, some tenants are finding it hard to make ends meet. With rents rising by up to 11% in some areas, tenants are faced with rising rental and living costs. For some, the pressure is too great and they fall into arrears with their rent.
“The continuing rise in possession orders is a sign that the situation is getting worse. Letting Agents need to advise landlords on how they can reduce the risk to landlords. One simple way is legal expenses and rent insurance which gives landlords piece of mind and more importantly insurance cover, arrears and legal costs of evicting the tenant.”
Article courtesy of Property Investor Today