22nd
Jun 2022
With ever increasing property prices many tenants just cannot or will not be able to afford to take a step onto the housing ladder with the obvious effect that rental properties’ demand outweighing supply favouring landlords.
The latest figure from an insurance company shows there is more than a third in rise – 37 per cent - in landlord demand for insurance during Q1 of 2022 against the corresponding period last year.
Landlords are fast tracking extra income protection because of the biggest BTL interest rates’ increase for seven years, and are also being hit by higher tax bills such as scrapping mortgage interest tax relief repayments.
There is an onslaught of additional bills that landlords are having to contend with chipping away at their incomes and without the necessary insurance could be facing losing 45 per cent of rental income due to ‘accidental’ property damage.
Many landlords have already or will be having to ‘fund’ massive costs to make sure their properties meet the new EPC standards and failure to do so will result in being unable to let out their properties in 2025.
According to ONS latest figures PRS tenants are having to deal with rent increases as they are now paying 3 per cent more rented ‘homes’ than last year.
A spokesperson for the insurance company, says: “It’s unsurprising that landlords have been keen to protect their incomes over the last few months. Although the buy-to-let market has been blooming, it is about to come under pressure from increases in taxes, interest rates and EPC reforms which will require some landlords to make costly energy-efficient updates to their property.
“This will contribute to a squeeze in landlord income, so it’s essential that they take all the necessary precautions such as insurance, to help weather the storm and avoid any additional unexpected costs. Policies that include ‘rent guarantee insurance’ can also cover them if a tenant stops paying their rent.
“That being said, renters must also consider what they can do to reduce costs and avoid any surprise bills as rent and utility bills continue to increase. For example, as a renter, contents insurance policies may protect against accidental damage to belongings, but most policies will require this type of cover to be added as an extra. So it’s very important to check the policy details.”
News Archive »