Helpland Warn Landlords Need Help To Evict Tenants In 2012

Recent research shows the number of people investing in buy to let properties rocketed during last year and shows no signs of slowing down. Exceptional tenant demand is driving the market according to research republished in the Financial Times. However, increasing numbers of tenant eviction cases and rent arrears are also unlikely to stop.

The UK saw 275,000 new applications to occupy rented homes during 2011, up by a shade under 25% on the previous year. Alongside traditional tenants such as singles and under 35’s, difficulties in accessing mortgages are believed to be bringing families into the rental sector. Rising demand reduced the average voids to 13.6 days, down from 14.8 in 2010. A rented property in London stayed empty for an average of just 12.2 days.

The market responded with an increase in private landlords, who now represent some 20% of all UK housing owners.

For many, low mortgage interest rates, falling property prices and high demand prompted an expansion of their portfolio. However, the outlook for even these more experienced landlords is still no completely certain in 2012, with rent arrears up by 18%.

Research from the quarterly BDRC Continental Landlords Panel showed that alongside expansion, many were still losing money. The final quarter of 2011 actually saw the lowest rise in rental yields throughout the year, despite almost half of landlords increasing rents within the previous 12 months. Half of all landlords had also experienced rent arrears. The rise in landlords making a loss was the largest recorded since the Landlords Panel began five years ago.

There are also inevitable concerns some landlords could face no choice but to evict tenants due to Housing Benefit caps for claimants in the private sector. Many housing experts worry that the new caps could mean a rise in tenant eviction due to simple discrepancies between the new maximum allowances and existing rental agreements. Industry research already points to an 18% rise in rent arrears during 2011 with an increase of 11,400 tenants owing rent during Q4 alone.

By February 2012, 402 tenant eviction cases saw a landlord possession claim issued, with UK courts granting 274 of these orders on a daily basis.

Lee Daniels, Director of specialist landlord support service Helpland, said:

"Tenant eviction cases have increased and in 2012 landlords may sadly still need to evict tenants for rent arrears alone. Landlords must follow the law to the letter, or risk very serious penalties.

"Yet many newer landlords may not realise that measures such as a Section 8 eviction can resolve problems without any further escalation."