Buy to let landlords insurance from Active

Buy to let property insurance for landlords
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As with any business, landlord insurance customers must identify their target market if they plan to rent out their buy to let property. This will help the landlord to identify the correct type of tenant for their property and this will ensure that the property will meet the needs of the prospective tenant. Landlords will need to do this before they buy, convert or decorate their property.

Short-term lets

Short-term lets are between one week and three months and are furnished. The rent usually includes charges for use of electricity and gas, with the tenant insurance customer expected to deal with the cost of the landline telephone (if used). The number of tenants requiring short-term lets is rising as employers increasingly expect their staff to be mobile and to work for short stretches in different locations.

From the landlord’s point of view, short-term lets are more work because the property must be in immaculate condition at all times and there is the ongoing need to market it for the next vacant period. In addition to higher set-up and maintenance costs, let property insurance premiums can be higher. However, rents are significantly higher and in the right location (usually city centres) a short-term let offers a better yield than a long-term one. Typical short-term lets are company and holiday lets.

Company Lets

A company, or corporate, let is when you have a contract with a firm to accommodate their employees as tenants. It can pay very well, but requires properties of a very high (and therefore costly) standard. Senior executives sometimes have a working
routine of being in one location for two days then moving to another region, but prefer the familiarity of a house or flat to the anonymity of hotel rooms. Beware that corporations may suddenly decide to relocate and no longer require property: if you go for this market, make sure there is more than one suitably large firm in the area. Hospitals and universities are other organisations that sometimes require short-term, high-quality accommodation.

Typical Locations

Obviously, the employee needs to be within easy reach of his or her workplace. Those without families are likely to prefer city-centre locations near shops and leisure facilities. Those with families tend to go for suburban or rural locations with good transport links, preferably near a park. Tenants are likely to be professionals and will have high expectations of local schools if they have a family with them. For those from abroad, an international school within easy reach could be important.

Lets can be long or short term, and often include a charge for water, gas and electricity so that the client does not have to deal with utility bills.

What you need to provide

An executive with no family or one who stays in the accommodation only during the working week is going to want a one- or two-bedroomed property with roomy living space. Families need more bedrooms, bathrooms and living space, a well-equipped utility room, and a garden suitable for children. Secure car parking is essential. The tenants will expect high quality TVs and hi-fi equipment, broadband access and a well-planned kitchen. Furniture should be modern and stylish. At the top end, corporate clients expect luxuries such as Egyptian cotton sheets and limestone bathrooms. Long-term professional tenant insurance customers may prefer to come with their own furniture, but since they are likely to have vacated their own family home, may also wish you to provide it. Decoration should be elegant (no strong colours) with accessories such as antiques or artwork. Some corporate tenants will expect a maid and a laundry/garden service.

The tenant’s take

As a tenant in accommodation recommended by (and possibly paid by) your employer, you’ll expect high-standard furnishings and fittings and excellent security to reflect the premium rent being charged. You’ll expect to be able to move in straightaway with the minimum of fuss, and know that someone from your firm or relocation agency has vetted the property thoroughly if you can’t do so. You may want to arrange for a cleaner to visit regularly.