The current cost of living crisis is affecting us all. From energy bills to inflation rates, fuel costs to food bills, everything seems to be getting more expensive for most people.
As well as all this, mortgages and rents are also rising, interest rates are on the up and wages are stagnating or even falling in real terms. On top of all this there seems little sign of any improvement in the near future.
All this will have a knock on effect not only for landlords, many of whom may or have already seen their mortgage bills rise if they are not on a fixed rate, but it could also have an impact on tenants.
So what should you do if your tenant – whether residential or commercial – is struggling to pay the bills?
Firstly check your own mortgage. If you are on a standard variable rate (SVR) see if you can get a fixed rate sooner rather than later as the Bank of England has already hinted rates are likely to rise again this year. If you are on a fixed rate already, check to see when it expires and make a plan to get another deal as soon as it does, as you don’t want to be caught out later on.
If you don’t already do so, consider taking out a rent protection policy which can help give peace of mind that you can continue to receive income, even if your tenants are unfortunately unable to pay their rent.
If your tenant is struggling there are ways you can help. If you are in a position to do so, and particularly if they are good, long standing tenants, you could always offer a rent holiday or a small reduction in the short term in order for them to get back on track.
We already know some landlords have been doing this but it’s not sustainable for all, or for the long term.
Next, look at energy bills – are they on the right tariff or are there ways they can reduce costs in this area?
Residential tenants on low incomes or those who have recently lost their jobs, can access benefits such as Universal Credit or Discretionary Housing Payments. These are available from local councils and provide extra money for renters. However, they are made entirely at the local authority’s discretion.
Support is also available to help people to continue paying other household bills, such as council tax. Every council has its own council tax support scheme to provide reduced bills for those least able to pay.
Other useful avenues of help and support include Citizen’s Advice and Martin Lewis’s Money Saving Expert which is updated regularly with tips and ideas of how to save, plus all the best deals when it comes to bank accounts, utilities, mortgages, insurance and budgeting in general.
Sheldon Bosley Knight’s head of lettings Carolyn Arnold said: “The cost of living crisis is having a huge impact on all of us so it’s important we are alert to the possibility tenants could be struggling to make ends meet and pay their rent.
“For landlords, this is where we as your agents can really help by liaising with your tenant and helping take the stress out of the situation.
“There are various ways in which tenants can be supported if they are in difficulties and we can help point them in the right direction so our landlords don’t have to worry about it.
“The main thing is not to panic. By keeping the lines of communication open, accessing all the help and advice we and other support agencies can offer, we can take the sting out of the situation.”