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Posted by Let Alliance on December 3, 2013
A survey of landlords and tenants commissioned by the National Landlords Association (NLA) has found that 40% of landlords earn little more than enough to break even each month, meaning just one missed payment can leave them financially vulnerable.
The survey also revealed some interesting insights into tenants’ perceptions of landlords, with one in three tenants stating that they thought their landlord was more interested in their earnings than anything else.
The survey was undertaken to investigate the impact of missed rent payments and cumulative rent arrears. In light of the findings and the potential impact of missed rental payments, the NLA has launched a guide to financial management for landlords and tenants.
In addition, the NLA is urging landlords and tenants to build better relationships to minimise the risk of disputes, missed rent payments and unplanned voids. This advice is particularly pertinent to smaller scale or those considered ‘accidental landlords’ who make up a large proportion of all landlords.
Carolyn Uphill, Chairman of the NLA, said, “Landlords operate within a business environment and it’s essential that they budget accordingly. We recommend budgeting for 10 months’ rent in any 12 month period to allow for missed rental payments and voids. It’s also essential that landlords carry out checks on potential tenants to minimise their risk of non-payment. However, there are instances when tenants are unable to meet their rental commitment; circumstances change and finances take a turn for the worse. In these situations, landlords should be sympathetic to their tenants’ needs. Part of this involves investing in good relationships with their tenants so that they are able to be open about any financial difficulties or future plans. If the landlord knows what’s happening, they can work with the situation. Being a successful landlord requires effective communication, which in turn can help to reduce missed payments and voids that can have severe financial implications for many.”
To support landlords and tenants in their efforts to deal with issues, such as rent arrears, the NLA has created two guides. Landlords and tenants can visit www.landlords.org.uk/arrears to download the guides and find out more.
Source: http://www.landlords.org.uk (8th November 2013)