One of the leading landlord organisations in the UK has revealed that many of its members are dealing with tenants struggling to pay their rent as the economic downturn continues to impact on millions of people.
A survey by the National Landlords Association (NLA) has discovered that almost half of its members (49%) have experienced tenants going into arrears over the last 12 months and more than a third are concerned that they will have similar problems in the coming year. The research shows that the average holding of a NLA member in the UK is 12 units and that 4 of those will currently hold tenants in arrears, with the average amount owed coming to £2,363. However, it is the small scale landlord with just 1 or 2 properties who is facing the biggest threat to his investment and the survey revealed 1 in 6 landlords with just one property in their portfolio are in fact making a loss on their investment.
David Salusbury, Chairman of the NLA, said “It is a sign of the difficult economic conditions that so many landlords are experiencing rental arrears. In these circumstances, landlords should work with their tenants to minimise the impact of financial stress. Short term instances of arrears can often be resolved with a sensible repayment plan or a temporary reduced rent arrangement. It is in landlords’ best interests to help tenants through tough financial times where possible.”
Of course property investors can always buy landlord insurance policies that will cushion the blow of a tenant withholding payment of rent but in many circumstances a close relationship with tenants will alert a landlord to possible problems before they become serious. As a last resort landlords can apply to the courts for a possession or Section 8 notice if a tenant has not paid rent for a period of two months.