Renters boost for landlord insurance
Landlord insurance policyholders have received a double boost this week, with new figures showing that demand for rented property is likely to remain at its currently sky-high levels for the foreseeable future.
Tenants looking to get onto the property ladder are being forced to stay in rented accommodation longer than ever before due to lenders’ demands for high deposits.
The latest research from Nationwide shows that it takes the average renter eight years to save enough for a deposit.
And the need for landlords to ensure they have adequate landlord insurance to take advantage of high demand was emphasised by a survey from house-share website Spareroom.co.uk, which found that numbers looking to rent increased by 39 per cent in the last year.
At the same time, the amount of private rented stock going onto the market has dropped by 15 per cent since the start of the year, the website claims.
Bank of England figures on lending for January showed that the number of mortgages issued rose by seven per cent, bouncing back slightly from December’s low ebb.
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Commenting on the Nationwide data, chief economist Robert Gardner said: “Given that the recovery hit a soft patch at the turn of the year and looks set to remain sluggish in the year ahead, the property market is likely to follow suit, with relatively low transaction levels and prices moving sideways or modestly lower through 2011.”
While some experts are predicting a sharp drop in house prices this year, Nationwide anticipates a soft landing.
Spareroom.co.uk director Matt Hutchison is concerned, however, about imbalances in the rental market.
He said: “Existing rental properties are remaining off the market longer and with fewer new rental properties becoming available, the supply-demand balance is completely off kilter.”
That provides landlords with an opportunity to get a premium price for their properties – and having the right landlord insurance in place to ensure that good tenants remain in situ and to ensure that they remain marketable is vital.
With the threat of redundancy and forced sales hanging over many people – particularly public sector workers – opportunities for buy to let landlords to obtain more property to bring to market are likely to rise sharply.