Buy to let insurance

The buy to let market in the UK appears to be gathering pace, as there was a huge increase in borrowing by landlords over the past 12 months. A specialist lender  in the market, Paragon Mortgages, has unveiled 133% rise in mortgage lending to buy to let investors. From the beginning of March 2014, approximately 16,000 landlords borrowed in excess of £2bn to finance purchases for rental properties. However, the buy to let market is still well below the peak of 2007/2008. It is estimated that it is currently around 60% lower than at this time. Back in 2007 the loans for buy to let investors was worth around £120bn, however last year investors in property took out loans around £45bn. Examining the figures would indicate that the real buy to let boom was actually fuelling the financial crisis which later unfolded. It would appear that nowadays more experienced landlords are increasing their portfolios and landlords wanting buy to let insurance would be well advised to contact a specialist in this market. New landlords wanting to build up a portfolio of properties may find difficulties in raising capital. In order to ensure that their current investments are safe there are a range of buy to let insurance products that can cover the buildings and the contents. One of the benefits of buy to let insurance is that the rent can be covered in the event of a claim, for example if a property was rented out for £800 per month and there were a fire or a flood, then the policy would pay out to cover the rent whilst the repairs were being carried out. Also, the property can be covered for property owners liability. This would cover the landlord if the tenant incurred an accident or injury which resulted from an issue regarding the property. A buy to let insurance policy covers the property owners liability and the property itself. Also, subsidence is also covered, but as a general rule this has a higher excess which is normally set around £1000.