The LSL December Buy to Let Index shows that 11.7% of all UK rent was unpaid or late by the end of December, rising from 9.7% in November. Unpaid rent totalled £276mn across the UK in December, the highest total since December 2009.
The property industry, headed by the British Property Federation (BPF), has repeatedly warned that many landlords will be forced to remove properties from the system, upping the pressure on hard-pressed councils to find homes for those receiving housing benefit.
While it is possible, albeit slowly, to recoup rent from tenants who are not LHA claimants the same safeguards are not in place for those who are - costing the taxpayer millions of pounds each year.
Landlord groups, alongside homeless charities, have campaigned for the return of direct payment since it was removed in 2008. It is now clear that this has lead to increased rent arrears and evictions, and has caused money intended to be spent on welfare to leak out of the benefits system. Conservative Party ministers had pledged to restore full direct payment before the election.
Ian Fletcher, director of policy at the British Property Federation, said: "Christmas is an expensive month for all with the pressure to ensure presents under the tree come the 25. But Christmas should not be bankrolled by long suffering landlords by not passing on December's rent.
"The government persists with a policy that was designed to empower LHA claimants, but the truth remains that millions of pounds of taxpayers' money is being wasted and not finding its way to the landlord.
"There is already growing evidence that landlords are shunning LHA claimants due to rental arrears - putting pressure on local councils at a time when their budgets are being slashed by Whitehall.”
