Credit Cruch Continues Squeeze On Tenants

Posted by admin

August 8, 2008

According to insurer AXA, a new report reveals an increase in private tenants missing rental payments could hurt landlords ability to pay their own creditors. The research was provided by YouGov on Axa’s behalf and reveals the potential problems buy to let landlords could be facing as the credit crunch continues its squeeze.

Many landlords are responding to high mortgage costs by raising rents but this added pressure is leaving many tenants unable to cope with the hikes. Petrol, food, electricity are hurting the pocket books of many Brits and if landlords add to these pressures it looks like more tenants will fail to pay their rent on time.

According to YouGov research, 7% of tenants had fallen into arrears over the past 3 months which is about half the number in the past year. Tenants are quite concerned whether they’ll be able to afford their rent in the near future.

The UK housing market has, over the past decade, experienced unprecedented growth and is now in a sharp correction. Stemming from the US sub-prime mortgage market crash, mortgage finance is increasingly difficult to acquire whilst house prices continue to plummet.

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