The number of landlords whose tenants are in rent arrears has fallen to its lowest level since 2017, according to new research from Paragon Bank.

Its poll of more than 750 landlords found that less than one third (32%) of landlords have had at least one tenant in arrears during the previous 12 months.

This follows a fall from 34% in the previous quarter and marks the lowest level of rent arrears in six years, when the metric was first tracked in its current format.

Void periods

The number of landlords reporting void periods also fell in Q4 2022 as fewer than one in four (24%) landlords experienced a vacant rental property, a drop of 4-percentage points on the previous quarter.

The average void duration fell from 82 to 70 days during the same period, with landlords managing larger portfolios - those with 11 or more lets - having properties vacant for even shorter periods of 44 days.

Richard Rowntree, Paragon's MD for mortgages, says a reduction in voids is unsurprising given the demand for privately rented homes, also at record levels.

'This adds further weight to the argument for investment in affordable housing across all tenures, something that buy-to-let landlords should be recognised for making an essential contribution towards.'�

He adds that although rent arrears are falling, the cost-of-living crisis won't impact all tenants in the same way, and that it is likely paying rent will be a real challenge for some.

'From speaking to landlords, we also know that many have good relationships with their tenants and are often open to working with them to overcome any financial issues,'� says Rowntree.

Read more: How rent repayment plans can work.