Jun

All rise! With the cost-of-living soaring, how can DIY landlords protect their income? The experts at Belvoir advise…

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There is no escaping just how much stress the huge increases in the cost of living is causing everyone, but what can landlords do to try and protect their income and their investments? Tenants who find themselves struggling to pay their rents can leave landlords with the challenges of still having to pay mortgages and finance the other associated costs of owning a Buy to Let portfolio. If the situation continues for a long period and rent arrears continue to mount up it may become necessary to initiate costly eviction procedures. So what can be done to help ease the situation?

At a time when households are being squeezed to the limit, the question of whether or not to increase rents is an emotive and sensitive subject, with so-called ‘greedy landlords’ often blamed for exploiting a difficult situation. In reality, far from being part of the problem, landlords are very much part of the solution to the UK’s current housing crisis. It is a fact that rents are subject to supply and demand, and rents have risen significantly in recent months, but it is a highly localised picture with rents varying from region to region. If you are currently a DIY landlord, have a chat with a professional agent who will be able to advise on the current rental value of your investment. Other factors for DIY landlords to consider are the costs of finding a new tenant, although in such a buoyant market with unprecedented demand it is unlikely that good quality rental accommodation will remain empty for long. Importantly, by working with an agent you can take advantage of their extensive marketing and referencing processes to ensure you find the best tenants for your Buy to Let property as quickly and effectively as possible. Landlords who work with agents can also have the peace of mind of knowing that they are legally compliant, and not likely to face hefty fines for breaches of regulations.

For additional peace of mind, it is advisable for landlords to consider investing in a rental guarantee package, which has the backing of a reputable specialist insurer. A rent and legal expense guarantee will ensure that landlords continue to receive monthly rents regardless of the tenant’s ability to pay. Should tenant eviction from a property become necessary at any point this can result in an extremely and lengthy procedure but investing in insurance can ease the stress by covering the costs of the agent to prepare all necessary paperwork and attend court on your behalf. Belvoir’s rent guarantee offers zero excess and 100% rent protection.

Now is the perfect time for landlords to review the financing of their portfolio. If landlords have a Buy to Let mortgage it is worth talking to Belvoir as we work closely with Mortgage Advice Bureau.

At present there are no signs of any easing of the cost-of-living crisis. However, in May 2022 Chancellor Rishi Sunak announced a £15 billion support package, which aims to offer some respite in the autumn for households who are struggling to pay for their homes to be heated. A temporary windfall tax on energy companies is enabling the government to fund the payment of a £400 non-repayable grant for all households to help pay their energy bills. In addition, later this year targeted support is being made available for pensioners, as well as people with disabilities and those on low incomes. It is hoped that even more support may be made available in the future, but in the meantime communication with tenants is key to ensuring that any problems are highlighted early, and any necessary steps are taken to ensure that debts do not mount up. A professional agent will be able to negotiate with tenants calmly to help defuse a difficult situation, and report back to the landlord so that all parties are aware of any potential problems and can focus on finding the best solutions for all concerned.

To find your nearest Belvoir office visit: www.belvoir.co.uk

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