More landlords are upset over rental arrears today than at any point in the past 2 years, according to a recent report detailing landlord struggles conducted by the BDRC Continental firm. More than a third of all buy to let landlords have said that they have tenants who are struggling to bring in the money needed to cover their rent. While there is variation among regions, the London commuter belt areas and the West Midlands region are the hardest hit with a higher proportion of tenants facing real challenges since the recession struck a few short years ago.

According to the BDRC Continental Director, Mark Long, there are indications that the latest research from the past quarter shows an stabilization could be taking part in the private rental market. However, he went on to say, enough time has not yet passed to assure analysts that a recovery is now in full swing. Uncertain economic conditions have plagued the private rental market landlords of the United Kingdom since the global recession began and today arrears are at an all time high. Part of this may be due to the Local Housing Scheme that was begun back in April of 2008, a plan that has drawn a fair amount of criticism lately due to the fact that landlords have been recording more incidents of arrears since the scheme first started took effect.

With money from the government being given directly to tenants to use to pay their rents, in accordance with the LHA’s terms, some tenants are not playing things fair and using the cash for other things instead of making good on their monthly housing costs. Of those surveyed by the firm, Long says that nearly a quarter of landlords have LHA tenants. Those with tenants on LHA have reported that they have a far higher rate of arrears to deal with. Since owners of properties for let have noticed this trend they are far more hesitant to accept these tenants due to the added level of strain it can place on their personal finances.

In addition to this, the government has stated that it is attempting to deal with the current budget deficit and may well eliminate the LHA as a means of income for tenants in peril. The scheme has led to so many claims that it has become a real money sink for the government, to the tune of £17.4 billion, up  £6.4 billion from 1998. Due to rising unemployment, this figure is expected to rise in the near future.

Those landlords who worry that they may face defaulting tenants should consider the advice from experts to look into guaranteed rent insurance. A number of excellent deals are available at the Landlord’s Insurance provider www.justlandlords.co.uk which has all the details on options.