The proportion of landlords experiencing rental arrears has fallen to its lowest level on record, according to new research.

Pegasus Insight found that 26% of landlords experienced arrears during the past 12 months.

That compares with 42% at the peak in 2020 and continues a six-year downward trend.

The latest figure represents the lowest level since Pegasus Insight began tracking landlord arrears.

However, the research reveals a significant divide between smaller and larger portfolio landlords.

Two-thirds (66%) of landlords with 11 or more properties experienced arrears during the past year.

By comparison, just 18% of landlords with between one and ten properties reported arrears.

Voids affect four in ten landlords

Voids remain more widespread than rental arrears.

Some 41% of landlords experienced a void lasting more than seven days during the past year. The average void lasted 66 days.

Again, larger portfolio landlords faced greater exposure.

More than two-thirds (68%) of landlords with at least 11 properties experienced a void. That compares with 35% of landlords with smaller portfolios.

Separate research from Pegasus Insight also examined the position of tenants.

Its 2026 Tenant Trends study surveyed 3,000 private renters. It found that 12% had missed a rental payment during the previous year.

Around nine in ten tenants described their rent as either manageable or comfortable.

However, Pegasus Insight said some renters continue to face difficult choices between housing costs and other essential spending.

Bethan Cooke, director at Pegasus Insight, said: “Rental arrears falling to 26% is encouraging, particularly after the financial pressures experienced by tenants and landlords over recent years. But it is important not to interpret this as evidence that those pressures have disappeared. Larger portfolio landlords remain much more exposed to arrears, while voids continue to affect four in ten landlords.

“Our tenant research also shows that most renters are continuing to meet their housing costs, but many household budgets remain stretched. With inflationary pressures persisting and landlords facing higher operating and regulatory costs, the position remains finely balanced. The priority now should be to avoid adding further pressures that could ultimately feed through into rents or reduce the supply of homes available to tenants.”