Protecting my income as a property investor
For professional landlords there are many risks inherent in the owning and renting of residential property, with many of them occurring through the occupational hazard of attracting, retaining and managing tenants. For property investors, one of the primary objectives of owning residential property is to receive regular rental income from tenants, with much of this income essential for servicing mortgages, maintaining the property in good condition and paying ongoing management fees. When properties are vacated and there is no continuing rental income, these costs may need to be borne personally or from the wider portfolio.
In considering this, it becomes apparent that the everyday risks that tenants face in their personal lives to meeting rental payments each month – accident, sickness, unemployment, death – become risks for landlords too; The “Financial Resilience” of tenants by connection affects the financial resilience of the landlord.
Tenants, however, tend to fall between marketing cracks; With no obvious need for life cover to protect a new mortgage debt there may not be the encouragement for a tenant to seek financial advice, and so many of the risks mentioned above may go unprotected. Because of this, landlords are also left vulnerable to tenants unable to meet future rent payments and eventually properties being vacated.
If you own residential property and would like to discuss this area further, please contact Ian Aldred via firstname.lastname@example.org or a member of the financial planning team on 01772 821021.