As the profits of buy-to-let investors begin to be threatened by rising property prices and an expected hike in interest rates, there is one area of property investment that can still offer big returns: refurbishments, according an article in The Telegraph.
There is a growing trend in the UK of investors buying run-down properties for a low price and then doing them up to be rented out – often adding extra rooms in the process.
HMOs for Big Returns
Many such refurbished properties are rented out as HMOs, or a “houses with multiple occupancy” (a number of distinct tenants under one roof), since they deliver the best returns. Refurbishing a property to a high level can also help attract quality, professional tenants who stay longer, it has been claimed. The report cites that some landlords say high end renovations also enable them to charge higher rents.
The article goes on to explain that those keen to do up run-down or uninhabitable properties are facing finance problems: many lenders won’t fund properties in such poor condition
However, some lenders are waking up to the potential of refurbishment properties, as a recent Telegraph article revealed.
The Right Cover for Renovation
Properties being renovated require specialist property insurance; regular property cover is not sufficient. Click4quote.com can offer unoccupied property insurance for those properties undergoing standard renovations. Once completed, if the property remains empty, perhaps while tenants or a buyer is found, then Click4quote.com’s specialist unoccupied property insurance can simply continue and can be amended to provide even more cover.
If you have any questions about these policy types, don’t hesitate to get in touch with Click4Quote.com today or get a quote online.