Tenants further in debt than at any time in 20 years
Tenants in the United Kingdom are finding themselves further in debt than at any time since the mid to late 1980s, according to a BBC News report. This situation carries especially negative ramifications for private sector residential landlords, many of whom struggle to collect rent and manage rental arrears. In fact, according to some statistics, as many as a third of all residential landlords have at least one tenant in arrears. For example, the BBC spoke with North London landlord Rukhsana Kashmiri who finds herself faced with two tenants who cannot meet their rental payments. Both of these tenants recently lost their jobs and now collectively owe Kashmiri £9,000. Kashmiri has found herself dealing with particularly high stress, and this has led to medical problems for the landlord and the need to take anti-depressants and pain killers.
Although rapidly growing unemployment among tenants is the main factor behind rental arrears, government issued housing benefits also cause problems. Previously, landlords could receive these benefits directly from authorities, but now it is common for them to be sent out to tenants instead. Additionally, there have been reports of delays as long as two months, before the arrival of the first housing benefit payment from the government. Adam Sampson leads a charity focused on housing issues and he noted that public officials could play a major role in alleviating the current situation by expediting the payment of housing benefits.
Thank you to Brian Milligan of BBC News for the initial report.