Six tips to help landlords beat pandemic downturn

WITH many tenants at risk of losing their jobs after the furlough scheme ends in March, what does it mean for landlords and what can they do to mitigate the risks?

Since the spring, most tenants and buy-to-let landlords have been protected from the coronavirus crisis thanks to the banks with their mortgage payment holidays and job support schemes.

Before the second lockdown was announced on October 31, it was expected that as the furlough and mortgage payment holidays were due to finish on Halloween, there would be some serious fallout.

The question is, what can landlords do to mitigate the financial risk on their buy-to-let investment? Help your tenants get the financial

support they are entitled to

Billions of pounds are being spent by the Government to help people whose income has been hit.

The better letting agents and self-managing landlords are supporting those tenants to gain a better understanding of the Universal Credit (UC) systems and payment levels, to enable their tenants to pay the rent and indirectly, help their landlord. Also, West Berkshire Council holds cash reserves for discretionary housing payments, which can be utilised to close the gap in rent between what UC pays and your rental commitments.

Adopting, and improving your buy-to-let property Demand for gardens or office space means landlords

Market comment by LEE FENN-TRIPP, director of Downer & Co Lettings

will need to think outside the box.

Those homes with tenants sharing might need to price their pre-coronavirus four-bed sharing house to say a three-bed sharing house plus office.

Hold on to your good tenants

Those landlords with decent tenants, who find themselves in financial dire straits should consider attempting to keep them, even if they have to decrease their rent over the short term. Surely it would be wise to reduce the rent by £50 a month?

Carry out firmer checks on prospective tenants

Many landlords checks are lacking in their depth. Trust me, there is tenant referencing … and then there is ‘proper’ forensic tenant referencing. Landlords must consider when choosing their new tenants, the type of work they do or who their employer may be, to enable them to decide on their future capacity to meet their rental commitments.

Rent guarantee insurance for your rental

There are insurance companies offering landlord rent guarantee insurance if your tenants become unable to pay the rent. Many firms removed these products in the first lockdown, yet some have returned, although premiums have gone up in price.

The Nuclear Option – eviction Landlords need to be conscious that, should their tenancy run into trouble, the Government has changed the rules when it comes to eviction during the coronavirus pandemic.

Eviction really is the very last option. Negotiation or arbitration will nearly always deliver quicker and improved outcomes for both parties.

The average rent for a Newbury property currently stands at £916 per calendar month.

Working on the basis that most evictions from the first rent not being paid, through to eviction, were taking between eight to nine months, (plus the mortgage payments), a landlord could face a £17,321 bill.

If you are a landlord who feels their reference checks are not to the level you might hope or if you want a chat about the best rental guarantee insurance, then give me a call ... what have you got to lose?