Fewer Voids in Last Quarter of 2013

According to a study commissioned by Paragon Mortgages, void periods fell in the closing months of 2013.

In the third quarter, around 36% of landlords experienced at least one void period, but this figure dropped to 34% in the last quarter.

The length of void period was also reduced in the last quarter.  The typical void period lasted 59 days in the final quarter, compared to 64 days and 69 days in the two three-month periods that preceded it.

When asked how they deal with the financial implications of a rental property going unoccupied, there were notable differences between small-scale rental property owners and those with larger portfolios.

Landlords with just one property revealed they often use their own savings (17 %) or other sources of income (19 %). Larger-scale landlords would use earnings from the rest of their portfolio (25 %), or rely on cash reserves they had built up while the home was occupied (16 %).

John Heron, director of mortgages at Paragon, commented: “It is good to see that void periods are less frequent and getting shorter.”

Paragon’s research also revealed the final quarter of last year saw a fall in the number of tenants going into arrears. One average, two tenants would fail to keep up with their payments for every 11 properties in a landlord’s portfolio.

Source: Rentman

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