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Landlords increasing portfolios
02nd May 2012
Demand for landlord insurance could be set to rise as private rented property owners look to expand their portfolios.
The latest survey from buy-to-let mortgage specialist Paragon has revealed that in the first quarter of 2012, landlords increased their portfolio size by 1.8 properties on average.
Furthermore, 20 per cent of those polled said that they expect to purchase property in the next 12 months.
With many landlords adding to their property portfolios, it could be necessary for them to seek out new insurance options to cover their new purchases.
Commenting on the survey, David Lawrenson, private rented sector expert at LettingFocus.com, stressed the importance of buy-to-let owners taking out the right professional landlord insurance.
"It is important to make sure that landlords have the correct level of cover," he said.
"There are certain risks that landlords have and most landlord insurance would cover some elements - loss of rent in the event that tenants move out, or there would be some cover for malicious damage by tenants up to a certain amount."
And those thinking about putting their home on the rental market for the first time should be aware that their standard home insurance will not be enough to provide adequate cover, said the expert.
"New people who get into letting properties out may think they can get away with standard home insurance, but it is not going to cut the mustard. It doesn't cover all of the risks that would apply when you're letting out a property," he commented.
"The home insurance would be voided anyway if you are not living in the property and are letting it out - there would be a clause on that."
Meanwhile, Paragon's research showed that terraced houses continue to be the most popular property choice for investment, cited by 64 per cent of landlords, followed by flats (57 per cent) and semidetached houses (46 per cent).
Posted by Simon Hayes