Taylor Scott International News
One in 20 people in the UK rents out a property to supplement their main income, receiving £678 in rent each month on average but many are unaware of the regulations, new research shows. This amounts to nearly £28 billion a year across the country as part of a boom in part time landlords, says the research from LV= landlord insurance. The research found however, that almost 500,000 landlords have not had their property checked by a gas safety engineer in the last 12 months, risking prosecutions and fines of up to £20,000 Also, some 32% of landlords have had their property damaged at some point, which has cost them £1,200 on average to repair. Landlords in London and the South East collect the highest rents at £1,079 and £816 respectively, followed by the West Midlands at £678 and then East Anglia at £676. Approximately 60% of this is spent on borrowing costs, management fees and maintenance costs, leaving landlords a healthy pre-tax profit of 40% on average. The trend is mainly being driven by people moving to a new home and then renting out their old one. Indeed 55% of these landlords are renting out properties that they never intended to, with 15% saying it was because they wanted a bigger property and 10% having to move for Whatever the reason for letting out a property, all landlords must comply with current regulations on rented homes, LV= points out. By law, all landlords must ensure that gas and electrical equipment is installed and checked annually by a registered engineer. Tenant deposits must be held in a deposit protection scheme and some local authorities insist that landlords in their area obtain a licence. A managing agent will usually take responsibility to ensure that all legislation is complied with for a fee, as well as check tenants and manage the rent collection. However, 49% of today’s part time landlords manage their rental property themselves and do not have such protection. As well as risking fines from the local authority, landlords could find themselves heavily out of pocket should one of their tenants make a claim against them. Slips and trips can result in expensive compensation claims for property owners who are liable for any harm to a tenant or member of the public as a result of the condition of the property. For example, a landlord could be sued by someone who falls and is injured because a pathway has not been maintained. Landlords can also be liable for damage to adjacent properties, such as an overflowing gutter causing water damage to a neighbouring house. Analysis of LV= data shows that the number of liability claims being made against property owners has been steadily increasing in recent years, which can be attributed in part to Britain’s growing compensation culture. The insurance needs of a rented property are very different to those of an owner occupied home and standard home buildings insurance will not usually… Continue reading →
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