The number of landlords facing ongoing problems with tenants who are behind with their rent payments is on the rise – and will balloon by next year, according to a UK estate agent.

Lettings agent Upad has said that 62 per cent of landlords currently experience tenant arrears and that 10 per cent of tenants fell behind with their rent payments in August alone – leaving some 34,000 landlords with no choice but to issue possession claims between July and September.

Upad added that rent arrears are becoming a real problem and are almost certain to be “the biggest issue facing landlords” by 2017.

James Davis, Upad CEO, suggested that recent reforms to Stamp Duty Land Tax (SDLT) and new laws to make landlords responsible for letting agent fees announced in last week’s Autumn Statement would see “overstretched landlords” try to recoup their losses by raising rents.

This would inadvertently lead to an increase in rent arrears – and most likely an increase in landlord-tenant disputes.

Mr Davis added: “The Chancellor needs to think carefully about the damage that is likely to be done, primarily to tenants, particularly if people are relying more on the lettings market than the sales market going forward in the wake of Brexit.

“Not only have investors had to contend with the new 3 per cent SDLT surcharge this year, but from April 2017, they are also facing plans to prevent landlords deducting mortgage costs from rental income and limiting tax relief on mortgage interest payments.

“These increased landlord costs will only make matters worse, especially for tenants who in some of the most expensive areas, such as our capital, are [spending] up to two-thirds of their salary on rent”.