Money Moral Dilemma: Should I reduce my furloughed tenant's rent?

REJP

behelpful said:

Do they have any income other than the wife's salary, e.g. husband's pension, savings/investments? Hence, what is the % decrease in their joint income, after tax? This is the maximum reduction she should be asking for.

Then there is the moral question of how much of the burden she should bear and how much you should bear.

OP stated her husband has a pension.

impuzzled

I'm an older landlord, I was told as a young teenager that you should have a little cash saved for that rainy day. Unfortunately younger generations have not have that kind of mentoring, and spent their spare cash with Easy Jet and leased cars etc. Now the wheel has come off, some people are looking to blame others.
Understandably that on low paid work it is difficult to save, asking for what amounts to 3 months holiday from paying your rent is a bit much when the landlord has probably had to take a mortgage out, or  spent their savings to but a property to rent out to enhance their retirement income.
A 25% temporary reduction on £750/ month for 3 months amounts to  £562.50. 

afis1904

impuzzled said:

I'm an older landlord, I was told as a young teenager that you should have a little cash saved for that rainy day. Unfortunately younger generations have not have that kind of mentoring, and spent their spare cash with Easy Jet and leased cars etc. Now the wheel has come off, some people are looking to blame others.
Understandably that on low paid work it is difficult to save, asking for what amounts to 3 months holiday from paying your rent is a bit much when the landlord has probably had to take a mortgage out, or  spent their savings to but a property to rent out to enhance their retirement income.
A 25% temporary reduction on £750/ month for 3 months amounts to  £562.50. 

So should landlords as they do run a business. It's not just a one-way street.

Scrapit

No way. Their rent is cheap and the income isn't bad. They don't need a reduction.

brhosjm

Absolutely not if they are doing better than you are then I think they are just being selfish but maybe they dont know your circumstances. Their rent sounds awfully cheap anyway!!

thorpehesleyptw

What utter cheek. if £2500 if only 75% of HER income they'll still have ALL of his state and personal pension income.
Then she'll have much less costs due to staying at home.
If you're worried about them giving notice to leave.... let them try and find somewhere else during the present situation!!
What letting agent will  be open to process their application . and besides they'll need a landlords reference.
Your tenant is really trying it on.
Explain politely that as your income  including their rent is much less than her income alone then financially you're not in a position to give that sort of help .

thorpehesleyptw

mrpunk50 said:

I've been lucky to have reasonably nice landlords, and now (thank God) I have managed to buy a house. However, this doesn't blind me to the fact that landlords are parasitic vultures. You artificially inflate the housing market in order to keep a monopoly on property and make profit off the fact that others cannot afford to buy. 
Every month, you take more than a quarter of this woman's wages (by your calculations, her wage is £3333/month, and the rent is £750). Then you have the audacity to wonder if she should budget better, so that you can carry on taking your cut.
In an ideal world, the vulture class of private landlords would be extinct.

Sorry Mrpunk50, you're bang out of order. your comments are nasty and not in accordance with facts. Sure, bad landlords spoil it for the many decent landlords who want to help those who either can't afford to buy or don't want to buy have a HOME.

lemonreptile

I think I’d re-evaluate their rent as £750 per month sounds incredibly low. Then, as a gesture of good will knock 10% off the new figure. Your tenants won’t ask again

jamqueen

This is not an easy one, there are a number of issues/points here. Speaking as a landlord myself, I would say to agree to what they have asked for. A lot of people commenting on here say that £2500 is a significant income, which it is. However, do you really know your tenants financial position? What other financial commitments do they have? It sounds as though they are a mature couple (with the husband being retired) - at their age, why are they still renting? There is nothing wrong with renting at any age, but the poster seems to be suggesting that this couple are rather flush financially - the fact that they are renting indicates otherwise. That suggests to me that something else may be going on. Are you sure that the figure of £2500 is accurate? Did you check this by contacting her employer when they started renting from you? She wouldn't be the first person to have been 'economical with the truth' when applying to rent a property. Also, do they have children? They are at the age when they may well have grown up children, even grandchildren, who they may be supporting.
Yes, their outgoings may be less in lockdown, but then so are the landlord's. The fact that the landlord's income is less than the tenant's is irrelevant, harsh as that may seem. I don't set my rentals at my tenants' income relative to my own, I set them at a fair price dictated by the marketplace, to a large extent. The poster doesn't say whether they have a mortgage or not, but again, harsh as it may sound, that is also irrelevant, The landlord's mortgage is the landlord's problem, not the tenant's. Besides which, they may well be able to apply for a mortgage holiday. 
Personally, I won't take out a mortgage. I may have fewer properties in my portfolio than if I didn't insist on owning them all outright, but then I can avoid situations like this. It could end up being a domino effect if even one tenant ends up not paying rent.
Last week I waived one of my tenant's rent for three months. This was on a commercial property. If I had insisted on receiving rent for this property, I could have put this tenant out of business (they have a wife and baby at home), and then not only would I have had that on my conscience, but I would have ended up with an empty property which would have been nigh on impossible to find a tenant for at the moment.
My advice is to agree to a 25% reduction - a bit of goodwill is worth a lot more than money in the long run. If the tenants found it impossible to meet the rent, they could end up homeless and the poster could end up with an empty property which they would not be able to rent out at present. Good tenants, and a good relationship with them, is worth a whole lot more than money.The poster may be somewhat worse off financially in the short term, but will be better off in the long run. This lockdown WILL come to an end and then we will have to carry on with life, and the decisions we've made, afterwards. 

heskeyheskey

I think they’re just trying their luck to be honest. Their other expenditure should be significantly down. Fair enough if she had been laid off, but she’s still on a hefty income.