How to support your tenants in the cost of living crisis24-11-2022 | Financial
Approaching your tenants with empathy this winter could just be the ticket to keeping them on side and feeling supported through the dreaded COLC.
Keeping your tenants in your property should be a priority to avoid unpaid rent gaps. Every business, property ownership included, should be keeping communication open with tenants who could be under financial pressure during the rocketing cost of living.
Below we have offered a five-step guide to keep your property management as seamless as possible and more importantly, to help you offer the best support to your tenants.
Five things you can do to help support your tenants (and your property) through the COLC
Check out our 5 handy tips which will help you make calculated and sympathetic decisions before, during and near the end of the tenancy.
Keeping good communication with your tenants
Having a good communication stream between you and your tenants will mean you’ll avoid getting ‘ghosted’ (not responded to) if you or your property management company are chasing for rent.
A simple text or email thread will keep your tenants off of the defensive. Remember they might be feeling crippled with other financial demands.
A payment plan can be a great way to establish a financial commitment from your tenant. It’s common to negotiate an additional amount of the outstanding rent to be added to the monthly rent. This is known as a ‘repayment plan’.
Always refer to your assured shorthold tenancy agreement to check you have offered this to your tenant as a means of paying arrears.
Energy bills support scheme
You should by now have been notified if you’re eligible for a discounted energy bill under the Energy Bill Support Scheme. As the property is in your name, the tenants might not be receiving this message and should be notified.
This could make a huge difference over the winter months when we are all using more energy. Check with Gov UK to see if your property is eligible.
Keeping your tenants warm this winter
The most effective way to keep your tenants warm this winter is by installing proper insulation. Whilst landlords are only required to obtain a minimum energy efficiency rating of E, it is possible that energy levels could be improved in other areas of the property.
The roof for example, if badly insulated can lose as much as 33% of the home’s warmth if the insulation ranges between 150mm -200mm. That’s a lot of wasted energy.
Making sure your property is economically insulated could mean keeping your tenants warmer and their energy bill considerably lower.
You might be able to get energy-saving improvements carried out on your property through the government scheme Energy Company Obligation which offers financial support with replacing insulation, repairing cavities in walls, and helping repair or replace your boiler. Check to see if you’re eligible by entering your postcode here.
The last resort – taking action
Prolonged unpaid rent can leave you in a precarious financial situation if not dealt with in good time.
If it’s very clear your tenant’s rent money isn’t coming in, here are the steps you need to take. We always recommend approaching this difficult situation with empathy but with the mindset that you are protecting your asset.
- After one month of no rent first talk to your tenants then write to them to explain their payment is late
- After two months of no payment send a letter to their guarantor
- Claim possession of the property using one of two routes. Under the Housing Act of 1988 you can take either section 8 or section 21 to regain possession.
By not paying rent, your tenant has broken their tenant agreement and you’re eligible to serve them an eviction notice. Be prepared to show evidence of them having not paid as they will most likely testify against this.
Reclaiming possession of the property. Whilst this isn’t technically an eviction, it does require your tenants to leave without you having to give a specific reason. You’re unable to enforce this within the first four months of the tenancy and will likely have to pursue this in court to settle any financial arrears.
Although under The Rental Reform 2022, Section 21 is to be abolished in order to create a fairer rental market for tenants.
Get unpaid rent paid by your insurer
If you’re unfortunately having to go through these steps, you’ll still have outstanding rent. Instead of hitting a bad financial situation yourself, get your landlord’s insurance in order which will cover unpaid rent.
Having that assurance on your side can be a huge weight lifted and allow your business to keep flowing uninterrupted.
Get in contact with CIA today and get peace of mind during these very uncertain times. With CIA Landlords, you can compare landlord insurance to find the best quote for your needs. Just give us a call on 01788 818 670 or get a quote now.
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