Landlords will lose thousands of pounds in rent as the cost of living crisis pushes the number of households falling into arrears to an 11-year high – and a third more than during the pandemic.
Nearly one in 10 tenant households in England will fall behind on rent this financial year, according to the Centre for Economics & Business Research think tank. That is equal to 407,000 families, who will be at risk of homelessness.
This is 97,000 households more than the number that fell into arrears during the first year of the pandemic, equal to a 31pc jump. It is also the highest level recorded since the 2011-12 financial year, when the rental sector was still recovering from the financial crisis.
The higher cost of living will lead to far greater arrears than the pandemic did because rents have risen so quickly in the past two years. Meanwhile, tenants are grappling with the biggest drop in real disposable incomes on record. There is now far less Government support than in 2020, when tenants could rely on furlough and other loans and grants, and landlords could use mortgage holidays, experts warned.
In late spring of 2022, real pay fell by 3pc year on year, while the annual rate of rental growth peaked at 11.5pc, according to Hamptons estate agents. In the past two years, rents have climbed by 16.2pc.