Changes to the tax regime, the continued restrictions of increasing regulation and legislation are all factors which have made life more difficult for buy to let landlords and their ability to profit from their property investment.
Some of those pressures with which buy to let landlords are having to contend are described in a story published by the Telegraph newspaper on the 16th of November 2016.
More important than ever, therefore, is the need to keep a careful check on the long list of operating expenses faced by any landlord – overheads such as mortgage repayments, letting agency fees, maintenance, and insurance.
One bright ray of light on the horizon is that property portfolio insurance might be a way of helping you to realise at least some of the savings necessary.
The trend towards property portfolios
Since owners of single properties may be finding it increasingly difficult to earn enough rental income from just one property, more landlords are considering the benefits and potential of assembling a portfolio of several properties.
By owning several properties to let, there are helpful economies of scale to be achieved on spending on a number of essential overheads – those economies might come in the shape of more favourable mortgage interest rates, savings on contracts with tradesmen you hire to maintain your properties, discounts from letting agents when they are given several properties to manage, and savings on the cost of essential landlord insurance when you keep all of your properties covered under the same property portfolio insurance policy.
Why buy property portfolio insurance?
A property portfolio policy is invariably cheaper than arranging insurance for each dwelling separately. But there are likely to be more than cost saving motives for arranging this type of insurance cover.
One of these is the administrative convenience of bringing all your property insurance requirements under a single policy. With a single policy, you have only one annual renewal date to remember, rather than having to monitor the different renewal dates for a number of other policies, which are likely to come to an end at different times of the year.
Without careful – and administratively time consuming and expensive – monitoring of each of your properties, there is a risk of your overlooking one of the renewal dates. This might have still further expensive and serious consequences if something does go wrong.
The consequences of such an oversight are not limited to accidental damage to your buy to let property. A failure to renew, for example, might leave you unprotected when it comes to your public liabilities as a landlord. If a tenant, one of their visitors, a neighbour or even a member of the public is injured or has their property damaged and you are held responsible as the owner of one of your buy to let premises, you may face stiff claims for compensation. Such claims have the potential for reaching very considerable sums and it is common for let property insurance to provide cover of at least £1 million. Portfolio property insurance helps to make sure that none of your properties is left exposed to this kind of risk.