The Health Crisis and the Furnished Rental Market, has the Risk of Unpaid Rent Increased?

For several months, the economic impact of the health crisis has been felt on the rental property market. At the beginning of November 2020, the ANIL (National Agency for Housing Information) published a report noting an increase in unpaid rents from tenants compared to 2019. But does this increase also concern the furnished rental market? Should owners of furnished properties protect themselves more by purchasing GLIs?

Furnished rentals, spared from the rise in unpaid rents

If ANIL has seen an increase in unpaid rents of 15% compared to last year, owners of furnished properties can be reassured. Indeed, the furnished rental sector remains spared from this increase in unpaid rents thanks in part to the characteristics of this type of rental: the clientele of mobile tenants and the average rental period shorter than in empty rental (in average 8-month rental) help to protect owners of furnished accommodation against the risk of unpaid rent.

How does Lodgis keep its unpaid rent rate close to 0?

At Lodgis we have always used our expertise to protect our property owners, which is why we do everything necessary to guarantee them the lowest possible risk of unpaid rent. Despite the current crisis context, our unpaid rent risk remains below 0.5%, thanks to:

Is it necessary to take out a GLI?

The Unpaid Rent Guarantee (GLI) is an insurance taken out by the owner in order to guarantee his rents and his charges in the event of unpaid rent from his tenantas well as the costs related to any damage to the property.
Lodgis has set up partnerships with private guarantor companies which allow us to offer our tenants additional guarantee solutions and to further strengthen theirrental files to reassure and attract property owners. These guarantor companies act as guarantors for the tenant throughout the duration of the lease and protect the landlord in the event of unpaid rent and damage.
This guarantee mechanism, fully paid for by the tenant (on average 3.5% of the total amount of rent), therefore prevents owners from having to take out an additional GLI (approximately 2.5% to 5% of the annual rent according to the contracts).

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