NEW research from letting agents shows the UK is feeling the squeeze of the economic slowdown, as more tenants are struggling to pay their rents on time.
Four in ten (41.2 percent) members of the Association of Letting Agents (ARLA) reported an increase in the number of tenants struggling to meet their rental payments to landlords in the six months to March 2012.
As a result, an increasing number of tenants are attempting to ‘knock down’ the price of their rent when negotiating with landlords. Haggling on rents has become most prevalent in the North East of England and the South West, whereas it is least prevalent in London.
Ian Potter, Operations Manager at ARLA, said: “With unemployment predicted to rise and average rents also increasing in some parts of the country, it seems more and more tenants are finding it impossible to make ends meet. It is likely that the same is happening for landlords, who may find their mortgage rate is rising. At worst, this double whammy may result in landlords defaulting on mortgages and tenants being forced to move out of a property.”
Tim Hyatt, ARLA President, said: “This situation highlights just how important it is for both landlords and tenants to carry out thorough research and, where possible, checks before signing a tenancy agreement. Our research shows that around ten per cent of tenants are asking for references on a potential landlord, but that is a relatively small proportion. We would urge anyone about to embark on renting or letting out a property, to consult a professional, licensed ARLA letting agent who will be able to advice on the possible financial viability checks that can be made.”