This article first featured on the Total Landlord Insurance website.
More landlords could be looking to take out let home insurance over the coming months as investors seek to take advantage of rising demand from tenants.
According to the latest Consumer Rental Forecast from property portal Rightmove, demand for rented accommodation continues to outstrip supply, resulting in higher rental yields for landlords, propertytalklive.co.uk reports.
It found that, based on Rightmove’s statistics on rental search activity versus available stock, there is more than twice as much demand for 12 per cent fewer properties, when compared with April 2009. Furthermore, many tenants now expect the resulting rise in average rents to continue over the coming months.
The proportion of those expecting rents to be higher in 12 months from now is 53 per cent, the survey found.
This includes 17 per cent that predict rents will be more than ten per cent higher. Both figures are the highest Rightmove has recorded in the last two years of the survey. In addition, half of tenants were forecasting rental price stability in the third quarter of 2009, but now just a third hold this view.
While this is putting increasing pressure on tenants’ finances, it is benefitting landlords and could lead to more people investing in buy-to-let properties and in turn insurance products such as landlord-liability-insurance.
“Existing landlords are in the driving seat and are enjoying the ride of rising rents and low buy-to-let mortgage rates. Landlords who offer a good rental product will have their choice of quality tenants busy searching the market,” said Miles Shipside, director of Rightmove.
“The question is: Will this scenario attract enough investors to ease the supply issues that the rental market currently faces?”
It follows a survey by the National Landlords Association which found that optimism among landlords has reached its highest level in 14 years.
