Rise in Rental Arrears is Cause for Concern
News Release
11th July 2011
Following the results of a recent survey showing a sharp rise in tenant evictions and arrears Lighthouse Property Services in Lincoln is advising landlords to protect themselves and their investment.
The research by Templeton LPA, which acts as a receiver of rents for lenders whose landlords have defaulted, reveals the number of tenants in England and Wales in severe rental arrears rose 13% year on year in Q2 to 74,492, while evictions increased 9% over the same period.
Residential lettings agent Lighthouse Property Services, which also has an investment sales division, started including 12 months’ rent guarantee insurance on qualifying private rental applications within its fees as standard in 2009 when the recession hit, in a bid to safeguard landlords against the pitfalls of letting a property.
Managing Director Tim Clark explained: “For landlords, particularly those who rely on the monthly rental income from their property to pay the mortgage, even one month’s arrears in this financial climate can be frustrating.
“Fortunately we’ve been able to keep our rent arrears running at a similar level to last year despite an increase in the number of tenants defaulting because a large proportion of our private landlords have rent guarantee insurance in place.”
Lighthouse uses HomeLet, which is theUK’s largest specialist insurance provider for the lettings industry.
Its Advantage Rent Guarantee policy includes a comprehensive credit check, financial reference, residential reference, an affordability check and rent guarantee insurance cover enabling you to claim up to six rental payments during a 12-month period, repossession costs and legal fees.
HomeLet has a specialist in-house legal and claims team which will also handle the entire eviction process if required.
“Very few lettings agencies include 12 months’ cover in their fees,” explained Tim. “This is something landlords need to be aware of because although things are looking good for the rental market, elsewhere in the economy we are still looking at more job losses particularly in the public sector.
“Unemployment is one of the main reasons why tenants default on their rental payments and no matter how well referenced a tenant is, no-one can guarantee that they will always be able to meet their financial obligations.”
Tim added: “For this reason we’re including a full year’s cover within our fees (subject to the tenant being approved) to ensure we provide the maximum protection for our landlords at an affordable and competitive rate.”
Kate Strawson
Shooting Star PR
01522 528540
kate@shootingstar-pr.co.uk
@shootingstarpr
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