If you’ve found yourself thinking that the rental market seems to be ever-changing, it’s definitely not in your imagination.
A number of years ago, buying a home was the norm. Today, lots of people are struggling to get on the property ladder, with house prices rising every year. For this reason, the number of people renting as opposed to buying a home continues to increase. The race for space suggests that there has never been a better time than now to invest in property. That said, it’s still important to protect yourself and your investment.
Yes, a buy-t- let is a great way to generate extra income and save money for the future. Part of protecting your property may involve taking out landlord insurance. Getting landlord insurance is simply about protecting your property against standard perils and making sure that your finances are secure. Here are five reasons why you should consider getting landlord insurance.
Covers Insured Eventualities
While there is no legal obligation to have landlord insurance, it’s fair to say that a buy-to-let comes with risks that you don’t necessarily have to worry about when you live in your own home. Unfortunately, if you decide to rent your property, a standard home insurance policy will not cover your property.
Landlord insurance, on the other hand, will cover your property against insured eventualities. For example, if your property is affected by a fire or flood, then you won’t have to worry about covering the cost of rehousing tenants.
Plus, landlord insurance can also cover any legal expenses, which may come in handy if your tenant gets hurt at your property.
Prevent High Turnover Rates
The landlord-tenant relationship can be tricky to navigate. In the past, landlords held most of the power. However, as tenants’ rights have improved, tenants now have higher expectations of their landlords.
This means that if you want to give your property a fighting chance at success, it’s a good idea to show tenants that you’re taking your responsibilities seriously. Simply knowing that you’ve taken precautions to make sure that the property is covered if anything goes wrong, will provide tenants with much needed peace of mind. Not to mention, this will help you secure a follow-on tenancy without void periods.
Provides Extra Peace Of Mind
In an ideal world, every landlord would have tenants who pay rent on time and look after the property. However, this isn’t always the reality and sometimes landlords end up with tenants that can be a headache.
With this in mind, it’s always good to have a thorough tenant screening process. This will reduce the risk of being left out of pocket should things go wrong. But even if you carry out thorough checks on prospective tenants, there is no guarantee that things will go right.
However, with landlord insurance, you don’t have to worry about protecting your property, as landlord insurance can be combined with other insurance policies to protect property owners and landlords
You’ll Need It To Get A Mortgage
Not everyone has the money to buy a property outright. Most people you will usually need a buy-to-let mortgage to buy a property for the purpose of renting it out. Taking into account the costs involved with a buy-to-let, you may be tempted to cut corners here and there. That said, deciding to not get landlord insurance is not necessarily wise.
Most mortgage lenders will insist that you take out a specialist landlord insurance policy before your tenants move in. In fact, you will require written permission from your mortgage lender before you decide to let your property. If you take on tenants without landlord insurance, then you may be breaking the terms of your mortgage.
If you own your property outright, you’re probably wondering whether landlord insurance is worth it. But remember, a standard home insurance policy will not protect your property when your tenant is the resident. So, it’s worth purchasing a specialist landlord insurance policy, as this could save you a lot of money in the long run.
Despite what you may think, landlord insurance is affordable. Though this will largely depend on the property value, the location and the desired level of cover.
It’s always a good idea to compare landlord insurance to find the best policy for you and your wallet. Should the unexpected happen, you will have peace of mind that your property is protected.