Disputes over rent arrears now account for more than one in five cases in the UK rental market, according to new research by leading lettings sector AML platform, FCC Paragon. The data shows a sharp rise in arrears-related disputes over the past five years, with 2023 seeing the highest proportion since records began in 2019.
FCC Paragon analysed rental disputes across England, Wales, Scotland and Northern Ireland, finding that over 47,400 disputes were lodged by tenants last year alone — a 13.6% increase compared to the previous year. Of these, 9,784 cases were linked to rental arrears, marking an alarming 80.8% rise year-on-year. This means that over one in five rental disputes now stem from unpaid rent — the highest share in over five years.
Rise in rental disputes reflects changing market pressures
The data paints a worrying picture for landlords. Even during the height of the pandemic in 2019/20 and 2020/21, rental arrears disputes accounted for just 14.3% of total cases. The proportion fell to 12.9% in 2021/22 but has risen steadily over the past two years, hitting 20.6% in 2023.
FCC Paragon’s Managing Director, Bekki Leaves, expressed concern over the trend: “Whilst the dark days of the pandemic are thankfully behind us, the figures suggest that the private rental sector landscape has only become more volatile when it comes to the relationship between landlord and tenant.”
She added: “The total number of disputes lodged has increased consistently over the last four years, whilst the number of these disputes relating to rental arrears has not only climbed since 2021/22 but is also accounting for a far higher proportion of the total.”
Landlords face growing financial risks
The surge in arrears disputes reflects the broader financial challenges faced by landlords. Rising interest rates, inflation, and increased costs linked to property maintenance have created a difficult environment for both landlords and tenants.
“With the sector undergoing some sizable changes in 2025, not least with the introduction of the Renters’ Rights Bill, the expectation is that this market volatility will only increase further,” Leaves warned.
Under the Renters’ Rights Bill, which aims to provide tenants with greater protections, landlords will face new restrictions on no-fault evictions and rent increases. While the bill is intended to stabilise tenant rights, landlords are concerned it could increase the financial burden on property owners.
Better tenant screening could help reduce disputes
Leaves stressed the importance of thorough tenant referencing to minimise arrears-related disputes. “This worrying trend really highlights the importance of thorough referencing when it comes to finding a tenant, as it allows landlords to identify the most financially viable applicant based on their proof of finances, credit history, references and employment status,” she explained.
By carefully screening tenants, landlords can reduce the likelihood of arrears and disputes, protecting both their income and property investments. “In doing so, they put themselves in the best position with respect to avoiding a dispute centred around a lack of rent being paid,” Leaves added.
