Mortgage News
Private landlords increasing repossession action
Private landlords now account for 17% of all repossession claims in the rented property sector compared to 11% in 2004, according to legal information provider Sweet & Maxwell.
Its figures reveal that at the height of the credit crunch the number of claims for repossession issued by private buy-to-let landlords jumped 23% from 17,047 to 21,004 between 2004 and 2008.
At the same time, repossession claims by social landlords dropped by 23.5% from 136,198 to 104,165.
Currently, 14% of households rent from private landlords.
Michael Donnellan, partner at London law firm Trowers & Hamlins, said: “The credit crunch led to a sudden drop in many tenants’ incomes. You don’t need to become unemployed to see your finances pushed over the edge.
“Private landlords have come under financial strain themselves and are likely to move much faster to replace a non-paying tenant with a paying tenant during a period of financial uncertainty.”
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Donnellan added that new rules for rent arrears, introduced in 2006 to reduce the number of court disputes between tenants and social landlords, have been successful in reducing repossessions by social landlords during the credit crunch.