Landlord risk?

[DonkeyApple]

Is anyone thinking that after the summer, when the hearing goes back on and the cost is even higher that there will be a spike in the level of arrears as people chose food and heat over rent?

Could this also risk tripping into landlord defaults and distressed selling increases?

[BoRED S2upid]

Bottom end of f the market maybe or Borris and his chums may have sorted out the cost and it won’t be such a huge issue.

[blindspot]

A good fraction of LLs will b§y now have been scared into taking rent guarantees and legal cover. So they’ll be ok as long as the underwriters don’t fall over.

The LLs without RG - if their TTs stop paying may struggle. But an easy 12-14 months for contested possession. Will mortgagors pull the plug and be stuck with resales, or agree deferments and TTP arrangements?

[DonkeyApple]

blindspot said:

Will mortgagors pull the plug and be stuck with resales, or agree deferments and TTP arrangements?

It's a good question. We've had a good 14 year run of the Govt opting to underwrite every crash and correction but 2011 saw the Govt specifically seek to deleverage the BTL so that it could be allowed to fail without taking the wider market down. One wonders if they might not step in to 'guide' lenders towards resolution and instead let the free market loose and allow lenders to do what they do?

[DonkeyApple]

BoRED S2upid said:

Bottom end of f the market maybe or Borris and his chums may have sorted out the cost and it won’t be such a huge issue.

I'm not convinced that all the risk will be at the bottom of the market. All it takes is a landlord with no big savings with a tenant with no big savings and there's a potential issue.

Plus, there's the risk of lenders increasing margins when the debt next rolls over and the landlord having to find tens of thousands to bolster their deposit.

[Pit Pony]

Personally, as a LL I'm not worried.
The current Tenant has just split up with her boyfriend, which should raise my worries as a single mother is paying the rent, instead of 2 people sharing it. But I think the reason they split was his failure to pay his share.
If she stopped paying, the interest is at a level I could afford, so an eviction taking months, would piss me off, but not cripple me.

[LooneyTunes]

Fully expecting more to run into difficulties. We’ve got a couple where we’ve replaced functioning (but old) boilers with more efficient modern units to try and help a bit. Would hope none have to choose between heat and rent, but there will be less sympathy if Sky is getting paid but rent is not.

If it gets tough then I suspect mortgage providers will avoid repos/forcing sales of rentals (which would give low recoveries with sitting defaulting tenants) and focus more on the other assets of owners.