According to research by Axa, the number of private renters slipping into arrears because of rising rent is increasing. 13 per cent of renters have gone into arrears in the past 12 months, with over half of these doing so in the past three months alone.
The research also found that over 50 per cent of tenants are increasingly concerned about being able to afford their rent going forward.
Axa says this will potentially add further misery to the mortgage market as buy-to-let owners are left financially strapped through tenants failing to pay the rent.
The insurer also found that 95% of those in privately rented accommodation have no kind of income protection to help out if their financial situation was to alter through losing their job.
Axa managing director of intermediary personal lines Mike Keating says: “Our research shows that over a third of people privately renting are doing so because they can’t get a mortgage at the moment. On the surface of it, this looks like the rental market should be buoyant. But if you consider that many of those renting may be struggling to make ends meet it’s certainly not all good news for buy-to-let owners.
“The cost of living is rising rapidly and average earnings are not keeping pace. And while rental rates appear to have dropped marginally in the last few months it’s going to continue to be tough for many tenants.”