The latest figures from Templeton LPA, a specialist practice of LPA Receivers and part of LSL, show the mounting financial difficulty faced by tenants across England and Wales.
They show that the rate of growth in the number of tenants in severe arrears is slowing, but has not been halted, rising by 1.6% in the third quarter of this year. The number of tenants now in arrears of two months or more now stands at 99,000, a 15% increase upon the total from last year, and the highest we have seen since 2008.
Tenants in severe arrears now represents 2.5% of tenancies in England and Wales.
Although the number of cases of tenants in severe arrears has grown steadily over the year, the number of tenants who faced eviction through a court order on a quarterly basis actually fell. In the second quarter of 2012, 25,422 tenants faced eviction notices, representing a quarterly decrease of 6% from the previous quarter, undoing the 6% rise from the quarter before that. On an annual basis, however, evictions remain 8% higher.
There was a small ray of light, though, when overall tenant arrears went into decline in August, with 9% of all rent late or unpaid, marking the first improvement in this measure in three months.
But, overall, the figures leave no doubt that tenants are struggling as hard now as at the start of the financial crisis, and as the gloom of winter approaches, it doesn’t look set to improve. Last week nPower and British Gas both announced price rises in time for the cold weather, which will add £100 and £80 respectively to the average annual bill from next month.
According to comparison site uSwitch, this latest rise means that the average annual household energy bill has risen by 151% in just eight years, from £522 in 2004 to a record high of £1,310 by the end of this year.
Paul Massara, nPower chief commercial officer, said, “There is never a good time to increase energy bills, particularly when so many people are working hard to make ends meet. But the costs of new statutory schemes, increases in distribution charges and the price of gas for the coming winter are all being driven up by external factors, for example government policy.”
Whatever the reason, this is bound to hit struggling tenants hard, pushing even more into arrears.
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