According to a new study by Pegasus Insight, more than a quarter of all landlords recorded rent arrears last year. This figure, standing at 26%, represents a significant decrease compared to the 42% measured at the peak in 2020. Despite this improvement, vacancy periods remain a continuous challenge for the entire sector.
The Pegasus Insight survey, which regularly examines the experiences of landlords in the United Kingdom, indicates a stabilisation of the situation after the turbulent years of the pandemic. During the peak phase in 2020, lockdowns and economic uncertainties led to a considerable burden for tenants and landlords alike, which was reflected in the high rate of rent arrears.
Ongoing Challenges and Market Observations
While the decrease to 26% is a positive sign, it indicates that a significant proportion of landlords are still facing delayed or non-existent rent payments. This underscores the need for landlords to implement robust rent management strategies and, if necessary, to seek professional support.
The issue of vacancy periods remains particularly relevant. These periods, during which a property is unoccupied and generates no rental income, can significantly impair the profitability of an investment. Experts from Pegasus Insight point out that optimising tenant changeover processes and ensuring attractive living conditions are crucial to minimising vacancies.
Strategies for Risk Mitigation
To address the challenges of rent arrears and vacancy periods, preventive measures and effective risk management are of great importance for landlords. These include careful credit checks of potential tenants, as well as clear tenancy agreements and communication channels. Market developments will continue to be closely monitored to enable early responses to changes.
- —Thorough credit checks of tenants.
- —Regular review of market conditions and rent price adjustments.
- —Effective vacancy management to minimise unproductive periods.
