The value of rent arrears and tenancy claims dropped in 2025 despite a marginal rise in the number of cases according to new data from Reposit.
Average arrears fell 8% year-on-year to £1,980, down from £2,143 in 2024. Claims values also dipped, easing just over 2% from £1,207 to £1,178.
However, while the sums involved were lower, case volumes edged up slightly, suggesting more tenants fell into difficulty even as the average debt per case reduced.
The shift comes amid moderating rental growth. Latest ONS figures show average UK monthly rents rose 4.0% to £1,368 in the 12 months to December 2025, down from 4.4% annual growth the previous month.
HIGH BORROWING COSTS
Mortgage data also points to some improvement. UK Finance reported 9,520 buy-to-let mortgages in arrears of 2.5% or more in Q4 2025, 9% fewer than the previous quarter, while 770 properties were taken into possession, down 14%.
Despite the softer arrears values, landlords and tenants continue to face high borrowing costs, affordability pressures and regulatory change under the Renters’ Rights Act.
Ben Grech (main picture), CEO of Reposit, says: “It’s encouraging to see the average value of arrears and claims falling. However, the marginal rise in case volumes shows that financial pressure across the sector remains.
“At the same time, the Renters’ Rights Act is creating a more complex operating environment for landlords, fundamentally changing how arrears and repossessions are managed. With the abolition of Section 21, many landlords are understandably becoming more cautious in their approach to rent arrears.”
FINANCIAL PROTECTION
And he adds: “The average cash deposit now stands at £1,296 which is £629 below the average arrears value. This shortfall highlights the limitations of traditional five-week deposits which often fail to provide adequate protection when arrears escalate.
“As a result, we’re seeing growing demand for deposit solutions that offer greater financial protection for landlords and are FCA-regulated, while also reducing compliance risk for agents in light of the new regulations.”
