Just because your apartment has been let to a professional city type, does not always guarantee tenants are able to maintain rent payment, that is the stark reality facing many landlords at all levels of the market. The spectre of unemployment especially in the normally buoyant financial services market is leading many landlords to fear that even their professional tenants may be unable to pay the rent.
A spokesman for Peacock Insurance, who specialise in landlords insurance, commented
“Even tenants who have traditionally been considered rock solid are finding it hard to meet rental payments.”
With an expected 5000 job losses in the UK following Lehman Brothers announcement that it is filing for bankruptcy protection under Chapter 11, fears that even more financial services jobs up and down the country could be lost. As the Bank of America steps in to buy Merrill Lynch and Northern Rock continues to lose money, the once rock steady well paid professional tenant is defaulting, leaving landlords to pick up the tab whilst searching for that elusive and increasingly rare –Rock solid tenant.
Landlords with properties aimed at the professional market are now taking up rent guarantee insurance in greater numbers than ever before. Rental properties to the middle and lower income market are not immune to the economic slow down, according to the Chamber of Commerce some 300,000 people will lose their jobs over the next two to three years and unemployment levels may top two million.
Insurance companies warn landlords not to ignore the potential of rent arrears. According to research by AXA, the number of private renters slipping into debt is on the rise. In fact, 13 per cent of renters have gone into arrears in the past year, with seven per cent doing so in the past three months.
Landlords rent guarantee insurance can be added to any landlords’ insurance ( http://www.peacockinsurance.co.uk/
Editors notes
Peacock Insurance (http://www.peacockinsurance.co.uk) based in Coventry provides commercial and personal lines insurance via a panel of leading insurers and provides online quotations for most business insurance products including liability insurance, landlords insurance and motor trade insurance.
