How Can Landlords Survive The Credit Crunch?

Doom-mongering headlines about the housing market have understandably led to some landlords becoming increasingly concerned about their financial situation.

In light of this, the following tips have been provided by the National Landlords Association, offering advice on how to survive the credit crunch.

** Research, research, research **
Thoroughly research the rental market in your area to make sure you are charging the right level of rent and not pricing yourself out of the market.

Even during periods of high demand, it's always better to charge slightly below market rent. It is also important to market your property effectively and remember that different tenants are looking for different things in a rental property.

** Make your mortgage work for you **
If you are struggling with mortgage repayments, or your circumstances change, talk to your lender and try to arrange a new repayment plan. If you are coming to the end of a fixed term deal, plan ahead to find a mortgage which best suits your needs.

If you are a portfolio landlord and you don't find what you're looking for with the traditional buy-to-let lenders, it may be worth exploring commercial finance opportunities.

** Avoid the void! **
It is amazing how many landlords experience rental voids because of a lack of forward planning. Marketing your property before the current tenants leave increases your chances of keeping the property fully tenanted.

A sure fire way of having no gaps is trying to keep good tenants for as long as possible.

** Pick your tenants with care **
Carrying out proper checks on prospective tenants should be par for the course for every landlord. Don't hand over the keys before carrying out credit checks, bankruptcy searches and previous residency information.

** Together you're better **
Landlords and tenants both benefit from having a good relationship. Courtesy, reliability and availability will make for a happier tenancy all round. What starts off as a small problem can turn into something costly if it's left to fester. Communication is critical.

A suggestion would be that you visit your property within the first few weeks of a new tenancy, to check with the tenant that everything is going ok.

** The Golden Rules **
The list of rules and regulations with which landlords must comply is long and growing. The risk to reputation and bank balance of not complying is significant.

Last year, landlords began having to protect their tenants' deposits. This year energy performance certificates are introduced for most rental properties in England & Wales. From January they are required in Scotland and Northern Ireland.

** Get it protected **
Taking a deposit is important. But changes to the law mean the cash now has to be protected in a Government-approved scheme. To make life easier when it comes to handing back the cash, it is a good idea to draw-up a clear and simple inventory.

Both you and your tenants need to agree and then sign two copies. This should help to avoid disputes at the end of the tenancy.

** Are you covered? **
There are a number of things for which landlords need decent insurance. From injury to tenants and their guests, to avoiding the dreaded void periods as well as building cover and damage insurance too. Can you afford not to have the right policy?

** Start a 'rainy day fund' **
Life as a landlord is rarely straight forward and any number of expensive emergencies can crop up without warning. Putting a bit of money aside each month will help take the sting out of the cost of a new boiler or windows.

And if it doesn't rain it pours, so if you've got several properties, make sure you put aside even more for the inevitable.

** And if you use an agent? **
If you are using an agent to find tenants or to manage your property, always check their terms and conditions. Discover how rigorous they are in vetting and selecting tenants, monitoring rent arrears and responding to your tenant's enquiries.

Make sure you are happy with the tenancy agreement they use - before a new tenant is accepted. It is advisable that you get a copy of the tenancy agreement and reference results once a new tenancy has started.

** ALWAYS get decent advice **
Whether you've been a landlord for years or if you're just thinking about taking the plunge, it's important to get the right advice. The market is always changing and it's worth listening to the view of an experienced landlord.