Consumers Face Arrears As Rents Inflate

According to the LSL monthly index of buy-to-let rents index, many tenets are being forced into rent arrears as landlords look to take advantage of the sluggish housing market and push up rents faster than the rate of inflation. The research shows that approximately 507,000 people are currently in rent arrears. The highest increases were seen in the South east and London, which saw a staggering 2.8% and 2% rise during August respectively.

According to the LSL monthly index of buy-to-let rents index, many tenets are being forced into rent arrears as landlords look to take advantage of the sluggish housing market and push up rents faster than the rate of inflation. The research shows that approximately 507,000 people are currently in rent arrears. The highest increases were seen in the South east and London, which saw a staggering 2.8% and 2% rise during August respectively. The figures come hot off the heels of CAB figures which showed an 18% increase in rent arrears enquiries on the same period the previous year.

David Newnes of LSL Property Services reasons the cause of the rise “Rents are jumping up as more and more potential home buyers opt to rent. People are wary of a crash in house prices and concerned over the effect of government cuts on their own ability to meet long-term financial commitments. Additionally, many can’t get a mortgage at an affordable rate”.

Some experts have warned that the increase in arrears could result in a rise in the number of people going Bankrupt as those with a severe debt problem and no material assets decide they have little to lose.

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