WHY IT PAYS TO MAKE YOUR TENANT’S HOUSE A HOME

Both landlords and tenants may be facing financial hardship at the moment, which is why an honest dialogue is key, says Phil Cooper

It is looking increasingly likely that the second quarter of 2020 will see a significant fall in GDP, as the economy largely grinds to a halt in the wake of the coronavirus crisis.  Few will be spared the economic cold winds which are blowing in the virus’ wake; for landlords and for tenants, these are unprecedented times.

We are all supporting the fact that the best way of keeping the lid on the spread of Covid-19 is to stay at home.  Our homes are more important than ever before, safe places where we are being urged to stay put.  But despite the welcome financial help from the government, many individuals will be facing a drastic cut in their incomes.

It’s simplistic to say that landlords can afford to forego the rent because lenders are offering three months’ mortgage holiday. It is also a requirement of tenants to pay for the very houses keeping them safe. Furthermore, if tenants simply don’t pay the rent, landlords are often left in financial difficulties, so passing on the problem doesn’t work either.

In these circumstances, we would strongly recommend  that landlords and tenants talk to each other.  Only open and honest dialogue will they find a way through.  It’s no more constructive for tenants to stop paying rent than it is for landlords to refuse to show forbearance if their tenants are facing real hardship.

Perhaps a compromise can be reached, maybe a reduced rent level now while the tenant cannot work, balanced by an increased rent later in the tenancy once they are able to earn again.  Insisting on an unaffordable payment plan is in the interest of neither the tenant nor the landlord, if it’s not going to be adhered to.

Tenants need to look at all the options they have, to pay as much of the rent as possible, whilst landlords need to work out what is the minimum rent payment they actually need (as opposed to want).

Landlords who have insurance policies should also be checking if they are covered if the tenant cannot pay the rent – for cover taken out before the advent of Covid-19, this may be the case.

It may be a cliché, but we really are all in this together.  A bit of give and take on the part of both landlords and tenants will help everyone get through it.