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Buy to let property insurance: Landlords struggling to cover mortgage payments
16 Jul 2010
Thousands of landlords are struggling to cover their mortgage payments, according to a survey from Spareroom.co.uk, in news which could affect buy to let insurance customers.
The figures from the flat and house share website show that 41 per cent of landlords admitted that rents from their tenants barely cover the monthly repayments, while 43 per cent said that if interest rates rise by two per cent, rent will no longer cover costs.
Matt Hutchinson, director of Spareroom.co.uk, said that many landlords may not be able to sell their properties because of the rise in the capital gains tax, or will have to do so at a loss, while those who do not sell face higher mortgage payments.
"For many landlords, it is hard to know which way to turn and it could be that tenants feel the full force of landlords' financial strain," he continued, as landlords may be forced to put up rent to cover costs.
However, there was some potential good news for landlord property insurance customers recently, as the government's new CRC energy efficiency scheme will allow them to save money on their energy bills, according to investment solutions provider Threadneedle.
Posted by Michael Brown
