Landlords have come under fire for apparently insisting that their tenants take out accidental damage insurance, which may set them back more than £68 a year.
One national newspaper has reported that a growing number of landlords and letting agents are now refusing to rent properties out to tenants unless they have insurance to cover accidental damage to the landlord’s fittings and furniture.
The amount is being added to a tenant's deposit, which is usually a month's rent.
Generally, when a landlord lets a house, they are responsible for buildings insurance which will protect the property itself, with the tenant being left to find and pay for personal contents insurance which will protect their belongings.
”This type of insurance is unnecessary”
A partner at London-based Anthony Gold Solicitors, Giles Peaker, said: “This type of insurance is unnecessary and, arguably, unfair under the Consumer Rights Act.
“Anyway, a landlord cannot claim for fair wear and tear.”
There's also a growing number of specialist insurers who are offering standalone policies which include cover worth up to £4,000 for a tenant damaging their landlord’s fittings.
One insurance firm is charging £68 a year for a policy whereas the cheapest insurance policy taken out by renters would cost £98 with £25,000 of contents cover.
Lettings agents see a spurt in buy-to-let activity
Meanwhile, letting agents in the UK report seeing a spurt in activity from buy-to-let landlords hoping to beat April’s tax regime changes.
The Association of Residential Letting Agents (ARLA) says that 25% of agents have seen a growth in landlords making buy-to-let investments before the stamp duty tax hike comes in.
However, ARLA says that their membership is expecting to see activity decline once the 3% surcharge is brought in.
ARLA's managing director, David Cox, said: “Buy-to-let landlords are determined to complete their purchases before April's changes come in and are storming the UK's housing market. This means the lull that we would usually see is now less significant.”
Stamp duty reforms for buy-to-let properties
However, he added that the stamp duty reforms for buy to let properties are of concern to ARLA's letting agents, with 62% predicting that rents will rise from April.
Another 65% of agents said the new reforms will force landlords from the market and lead to a shortage of available rented properties.
Mr Cox pointed out that the predicted fall in the number of properties available for rent will have “a detrimental effect across the country for renters”.