The housing market has remained largely buoyant over recent years, while other forms of investment have struggled to generate any kind of yield. As a result, more and more people have entered the fray as private landlords, and despite last year’s increases in stamp duty on buy to let properties, the trend shows no sign of diminishing. In fact, there are now over two million private landlords in the UK.
But while investing in a rental property makes plenty of financial sense, there are more potential complications than there are with more conventional types of investment. Routine and emergency maintenance and repairs are one thing that will spring to mind, but perhaps the biggest headache of all is the risk of having a problem tenant.
The ultimate nightmare scenario is having them sign the tenancy agreement, move themselves in and then promptly stop paying the rent. If you find yourself facing this kind of situation, the truth is you won’t be the first. So let’s take a deep breath and see what you can do about it.
As the late, great Bob Hoskins told us, it’s good to talk. There is a big difference between “won’t pay” and “can’t pay” so find out what’s the problem. The reaction you get to an open, friendly and professional invitation to sit down and talk it through will help decide what happens next.
Even if the tenant is unwilling to talk, stonewalls your approaches, or responds in some other way that is uncooperative, always stay polite and professional. It will put you in a better position if things get serious later.
If, on the other hand, the tenant clearly wants to pay but has been faced with some temporary financial problem, you might decide to help them out. Perhaps you could offer a short-term rent reduction while they get back on their feet. After all, if they are otherwise good tenants, it probably makes more sense all round than kicking them out and looking for someone new.
Another way you might be able to help is if they are struggling because of a change in personal circumstances, for example the loss of a job, or a relationship breakdown in which two has become one. These are circumstances in which government assistance might be available, so point them in the direction of the Citizen’s Advice Bureau for further guidance.
Nine times out of ten, the amicable approach pays dividends and gets you to a solution. But there are some nightmare tenants out there that leave you no option but to take legal action to get them out of your property. If you are still inside the fixed term period stipulated in the tenancy agreement, you will need to issue the tenant with a Section 8 Notice, stipulating the circumstances under which you are seeking possession. If you are over the fixed tenancy period, it is far easier, and you simply issue a Section 21 Notice, in which there is no need to give formal grounds.
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