Buy to let tenant finances are improving at last with fewer in serious rent arrears and facing eviction than a year ago.
The number of tenants more than two months behind with their rents has fallen 10% in the year to the end of September 2014 – down from 71,700 to 65,200, according to a new report.
The research shows less than 1.6% of tenants are in serious rent arrears.
At the same time, the number of eviction orders for the third quarter of 2014 is 16% less than at the same time last year – down from 33,000 to 27,700.
The figures come from the latest buy to let tenant arrears tracker compiled by LSL Property Services, the firm which owns high street letting agents Your Move and Reeds Rains.
“The private rented sector has mustered enough new capacity to meet, in part, the growing demand for affordable housing, through the greatest economic depression in modern times,” said the firm’s director David Newnes.
“This isn’t just about those relatively prosperous households forced to put ownership plans temporarily on hold. For many thousands of others, with far tougher monthly budgets, private tenancies have also provided a lifeline.
“For many renting is now their chosen route as it provides flexibility and mobility. Gradual rent rises, on a par with inflation, have helped
“Now a bigger turnaround appears to have happened. For many years more momentary cases of rent arrears have been in decline yet it’s only recently that the most serious cases – where families could actually lose their homes – are following suit.”
Improving tenant finances has also helped landlords repay buy to let mortgage arrears.
More than 25% has been paid off outstanding arrears by landlords in the past 12 months, leaving 13,400 mortgages in serious arrears.
“Plenty of landlords have had their own financial problems but after astonishingly steady progress these issues have almost entirely been consigned to the past,” said Newnes.
“This isn’t just good news for those with an investment property to support their pension plans. When landlords have a healthier cash flow tenants are less likely to see rapid rises in market rents.”