2012 ended on a high for private sector landlords in the UK as severe tenant arrears dropped by 15.6% in the final months of the year.
In the fourth quarter of the year there were 16,000 fewer tenants in severe arrears of more than two months compared with the previous quarter, meaning that the number in this situation has fallen for the first time in over a year.
However, the improvement has yet to filter through to evictions, with court orders up 5.5% in the third quarter of the year, the latest tracker report by Templeton LPA, part of LSL Property Services.
The arrears improvement contrasts with the trend in the preceding four quarters, where severe arrears rose by an average 10.8% per quarter. They are now at their lowest level since the end of 2011. The fall leaves the level of severe arrears cases 9.2% lower than the average for the previous four quarters.
The quarterly drop slowed annual growth in the number of tenants in severe arrears to just 0.3%. Such tenants now represent 2.2% of tenancies in England and Wales, down from 2.5% in the previous quarter.
There was also a wider improvement in tenant finance. According to LSL
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