Landlords to face tough times in 2010

Landlords are likely to face "challenging conditions" next year, amid the "slow process" of exiting recession, advice specialist Landlord Assist has warned.

Growing rental arrears are likely to be the cause of difficulties as tenants may find it difficult to meet their rent obligations if unemployment remains high, the organisation claimed.

They estimated around 150,000 tenants will end up in court this year alone due to rent arrears.

Managing director Graham Kinnear said: "A rise in unemployment has meant that more tenants have struggled to meet their monthly commitments. This has had a knock-on effect on some landlords, who have already seen the value of their assets increase.

"Landlords are less equipped to sustain non-paying tenants than they were a year ago and need to take precautionary measures to minimise the risk of being exposed to rent arrears."

The organisation warned that while the interest rate currently remains at an all time low of 0.5 per cent, an "eventual hike" which could cause additional problems, was inevitable.

Should this happen, many landlords could face greater repayments on their buy-to-let loans.

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