There are ways to protect your rental income from tenants falling into arrears due to the ongoing cost of living crisis.
The cost of living crisis will increase the likelihood of tenants defaulting on rent payments and going into arrears.
With increases in energy bills, inflation and average rental amounts, tenants are facing some difficult times ahead.
However, we have put together a valuable guide to ensure that your income remains unaffected by any changes in your tenants’ circumstances.
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Create Your Advert TodayThe ongoing cost of living crisis
Although the signs point to the cost of living easing, many households will not feel better off, especially when it comes to energy bills.
Despite gas and electricity prices being lower than last year, most households might end up paying more for energy this winter because government support for bills is no longer in place.
Starting January 2024, Ofgem has confirmed an increase in the typical annual household bill from £1,834 to £1,928, marking a rise of £94 or 5%.
It’s important to note that a decrease in inflation doesn’t necessarily translate to goods and services becoming cheaper; rather, it signifies a slower rate of price increases.
This suggests that prices are still likely to rise in the coming months, albeit not at the rapid pace that has impacted households nationwide over the past year.
As the cost of living crisis goes on, it will become increasingly difficult for tenants to be able to afford their rent.
But don’t worry – with tenant referencing and the re-introduction of Rent Guarantee Insurance, you can protect your income and safeguard against the cost of living crisis.
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How to protect your rental income
In these uncertain times, we understand the challenges you or your tenants may be facing, so we have put together a powerful combination of products to safeguard your rental income from arrears.
1. Referencing
The decision to reference your tenants ultimately rests with you, but we strongly recommend considering it.
Referencing provides invaluable insight into your tenants’ financial capability to meet rent obligations.
We offer comprehensive tenant and guarantor referencing tailored to various situations, including self-employed individuals, students, those on benefits, and more.
Tenants who pass our comprehensive referencing, or those with a guarantor meeting the criteria, also make you eligible for Rent Guarantee Insurance.
Find out more about our tenant referencing and get a complete breakdown of the report you’ll receive here.
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Explore Rent Now2. Rent Guarantee Insurance
In the past year, we have been able to re-introduce Rent Guarantee Insurance (RGI) for our landlords – securing your rental income in an uncertain economic environment.
RGI does exactly what it says on the tin – it guarantees your rent. If, for any reason, your tenant is unable to pay rent, you have the option to submit a claim against your policy, with coverage extending to tenancies with rental amounts up to £3,000 per month.
OpenRent’s RGI policy also includes legal expense insurance, so you don’t need to worry about footing the bill if you end up having to go through the courts.
Plus, your policy will remain in place, even if you change tenants, as long as they successfully pass the referencing process.
As the cost of living crisis continues, the challenges for both landlords and tenants are undeniable.
In these uncertain times, OpenRent is here to provide you with practical solutions to protect your rental income.
Our comprehensive tenant referencing ensures you make informed decisions, while our Rent Guarantee Insurance service offers a safety net for unexpected circumstances.
Explore these tools today and gain the peace of mind you deserve in navigating the evolving landscape of the rental market.
