A possible recession around the corner in the UK – make sure rental properties are properly insured
Released 3rd July 2008
Summary: Commentators are saying UK and Ireland could be heading for recession and consumers tightening their belts. One concern is they could be cutting back on essential services like insurance in rental properties
Economists are predicting that the UK and Ireland could be heading towards recession. Estate agents have reduced sales and have been laying off staff and in some cases as reported by a major Irish agent in the last ten days transferring staff to the buoyant lettings market.
In the UK similar situations are occurring up and down the country and although properties are not selling as they have been, are still letting out well.
Philip Suter of jml Property services has been in the letting business for over 30 years. In his career he has been responsible for setting up the residential letting departments of jml Property Services, Frank Farr & Sons and The JNP Partnership. All these have been located in the south east of England to the west of London.
Philip has also worked through the times when the sales market have been very good and very bad. Philip said "in the late 1980s and early 1990s there was negative equity problems, people could not sell so they turned to letting, however unemployment was not so good so quite often it was harder to let a property".
He went on to say "this time round, fortunately unemployment figures are still very low and those thinking of buying are waiting for property prices to drop and consequently they will prefer to let instead of buy."
There are signs that unemployment may start to rise again and unlike the early 1990's the rental housing stock in the UK and Ireland has vastly increased fuelled by the "buy to let" market. In Ireland many developers have not been able to sell apartments so entire blocks have been added to letting market. The downside of over supply could mean that rental prices will not increase and could fall.
With the on going credit crunch, consumers tend to cut back, people will continue to require mobile phones, satellite TV, but when it comes to economies the question of insurance comes high on the agenda.
Philip Suter warns that landlords and tenants must continue to insure their properties and contents. He has come across many landlords in his career who think that they will not take out limited contents insurance on an unfurnished property. Often they think the tenant's will cover their carpets and curtains, which it won't and then there is a burst pipe. The buildings insurance covers the repairs to the ceiling, decoration and plumbing, but not replacement of carpets and curtains.
Many tenants simply do not bother with insuring their belongings. They think these are covered by the landlord's policy, which in the UK they cannot be. They might spend a lot of money on ipods, mobile phones, TVs and computers and either forget to get them insured or cut back as they think "insuring them is a waste of money and they could spend the money on entertainment instead!"
In the UK there are several specialist providers of Landlord and Tenant insurance products, Companies like HomeLet, Endsleigh and Rentshield Direct. Rental insurance providers normally offer Landlords policies for buildings, contents, emergency repairs, legal expenses costs and rental guarantees.
For tenants they usually offer contents insurance and can cover items like bicycles as well. With some companies the policies are portable, so if a tenant moves to another rental, the insurance cover moves as well. Students are not forgotten either. These types of specialist insurance company will allow Landlords and Tenants to pay monthly or annually and quite often credit card payments are accepted.
When paying monthly of course, if the Landlord or Tenant, does not make their payment, they will find that insurance cover will stop and in the event of a claim there will be no insurance, so it is imperative that payments are continually made.
jml Property Services has been running jml - Insurance since 2002, this is an on line introduction service for Landlords and Tenants to obtain a quote on line and buy direct on line a policy from HomeLet, Endsleigh or Rentshield Direct. More information can be found at the jml insurance website www.jml-insurance.co.ukEnds....
jml Insurance.co.uk is part of jml Property Services, the trading name of Jeffrey Milner Ltd. The company is an UK based company that was established in 1979. jml insurance acts as an introducer for insurance companies selling property insurance including landlord and tenant rental products, pet insurance, wedding insurance, motor insurance, car hire excess insurance, travel insurance and non standard insurance products. They also operate jmlvillas.com an online marketing service for owners of holiday home property to advertise and are part of the jml Group that includes jml Training and Consultancy.
© jml Property Services July 2008
Agents Urge Landlords And Tenants To Retain Rental Insurance - Home Move The UK's independent property help portal 4th July 2008
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