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Explosion in number of rental arrears

From January to August 2007, the free advice helpline received just over 6000 calls from people with rent arrears, compared with 12,000 over the same period this year an increase of 99%. Calls from people with rent arrears have increased 28% over the last two years, and 9% in the last 12 months. Nearly 10% of all people calling National Debtline have rent arrears, compared to just 6% in 2007 and 8% last year.

Additionally, figures suggest renters have faced a growing number of broader debt problems, with renters for the first time accounting for more than half of the total calls to National Debtline.

Joanna Elson, Chief Executive of the Money Advice Trust said: "In the current environment it is clearly difficult for people to save the money for a deposit to buy a house and this has led to more people remaining in the renting market for longer. Where there is limited supply and greater demand, rising prices will always follow.

"However, rising rent prices are not only making it harder for people to save for a deposit, they’re also pushing more people in debt. This is a dangerous spiral; with increasing numbers of people entering the renting market, and fewer people leaving it, it is hard to see how the situation will improve.

"Many people’s budgets are tight already with stagnant earnings growth and inflation above the Bank of England’s 2% target. Sharp jumps in renting costs can push individuals and households over the edge and into an unmanageable situation.

"Anyone struggling with their finances should seek free, impartial advice as soon as possible. Advice is available online through My Money Steps, over the phone at National Debtline, or face to face at your local Citizens Advice Bureau. If you are a struggling buy-to-let landlord, or if you are self-employed or the owner of a small business, you should contact Business Debtline."    

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