Legal information provider Sweet & Maxwell recently revealed that the rate of landlords evicting tenants has increased to the highest level for five years.
Annual eviction rates to the end of June this year totalled 36,177, up from 33,199 in the same period last year.
If a tenant has failed to pay rent the landlord can apply for a county court order and have them evicted.
Sweet & Maxell suggested that the Government’s “bedroom tax” could be a major reason for the substantial rise in evictions. The “tax” is actually a reduction in housing benefit for claimants with empty bedrooms.
Additionally, Sweet & Maxwell pointed out that rents have risen consistently over the last few years, while wages have dropped off in real terms. The result is that many people are seeing their budgets stretched to breaking point.
Because there is such high demand for rental property – especially in the south and London – many landlords are keen to remove tenants who cannot pay as soon as possible. The “opportunity cost” is seen as very high, meaning landlords are arguably less willing to give tenants more time to pay, preferring to replace them with more reliable tenants.
Buy to let investors and first time buyers are finding it easier to obtain mortgage funding, creating ever-higher demand in the rental sector.
On the other side – as many of our landlord insurance customers are aware – landlords are often under a lot of pressure to pay their mortgages, making reliable tenants highly sought-after.
Tenants may get an easier ride once more new build properties are on the market, giving first time buyers more purchasing targets and relieving pressure on the rental sector – thereby stemming rent rises.
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