How to avoid having a property that is untenanted for a period of time
This week, we will be working with landlords/ladies on the costs that their prospective tenants may have to bear before they can move in.
Generally, incoming tenants are asked to cover a certain member of costs before having the right to a tenancy. These costs could include a refundable security deposit (which is normally capped at 5 weeks’ rent or 6 weeks if the total annual rent is £50,000 plus) and/or a refundable holding deposit (which is normally capped at 1 week’s rent).
At this challenging time of the coronavirus and economic downturn, most people (including landlords/ladies and tenants) have experienced some difficulties. Because of the current difficult health and economic situation, it is in the interest of both sides (landlords/ladies and tenants) of the rental agreement to work out a level of upfront costs that could be manageable by tenants.
What are those upfront costs we are talking about?
There are many types of costs depending on the cost structure that each letting agent or landlord/lady has set up. In the context of this week’s work with landlords/ladies, we can single out the refundable security deposit and refundable holding deposit.
Landlords/ladies may have their own good reason to set up a level of these deposits to suit their own investment or outgoing obligations on the property. However, they may need to include what the market is telling them about tenants’ long term financial stability as well.
Why it is important to consider market information and lower upfront costs
Lowering the upfront costs for your incoming tenants will help as follows:
<> Avoid loss of rental income in the long term
<> Encourage renters to move and increase the demand of properties to let
<> Boost the expansion of property portfolios
<> Prevent void properties
Whether or not landlords/ladies would like to require a rental bond (or security deposit) and a rent in advance before their new tenants move in, it is always of good idea to check this requirement does not end up to becoming a cost in itself.
Those landlords/ladies would like to dip into the issue of upfront costs for their incoming tenants, they are free to contact Home Relief.
If you are looking for an affordable location and home, Home Relief is the people dealing with affordable homes you could consider in your property searches and enquiries.