Recent research has found that the UK
letting market is feeling the negative affects of the
credit crunch with many letting agents in the UK
reporting that tenants are struggling to keep their rental
payments up.
ARLA
According to the Association of Residential Letting
Agents (ARLA), around 41.2% of their members have reported
an increase in the number of tenants struggling to pay the rent
across the last quarter of 2011 and the first quarter of 2012.
Affects of the Recession
This has sparked a trend of certain tenants looking to negotiate
on their rents with their landlords and with
unemployment unfortunately due to rise again
alongside rental increases, it makes it very
difficult for individuals, couples and families to
afford their rent. By the same token, landlords
are feeling the pinch on their mortgage repayments; this in turn
could lead to tenants being forced to move out, whether they can
afford the rent or not due to potential mortgage
defaults.
Tenant Reference Checks
This news demonstrates how important it is for letting agents
and landlords to do the necessary research before granting a
tenancy. For landlords who choose to use a letting
agent; they need to make sure that the agent is offering to conduct
the necessary background checks before they
recommend them for tenancy to the landlord. By the same token,
landlords who choose to manage their properties privately; they
need to make sure that they do due diligence and
carry out a credit check, employer reference and previous landlord
reference, allowing them to make an informed decision on
whether to award tenancy or not and hence signing the
tenancy agreement.
To complete the necessary viability checks before entering
into a tenancy agreement, sign up to Lettingref to complete a full tenant
reference with credit check.
Source - ARLA