Landlords urged to take out insurance

Landlords should take out rent guarantee insurance to provide protection from rent arrears, said Landlordzone.

Cover is "especially useful" for those landlords worried about mortgage arrears, said a spokesperson for the letting industry`s online community.

Emergency assistance and breakdown cover is also "a good idea" as it makes repairs easier to manage, according to Tom Entwhistle, editor of Landlordzone.co.uk.

Rent guarantee insurance may also cover legal costs if a tenant is taken to court.

Since April 2007, landlords and letting agents in England and Wales have been required to join a tenancy deposit protection scheme when offering an assured shorthold tenancy agreement.

Almost a million deposits worth £900 million have been protected in the past year, Citizens Advice recently told BBC Radio 4 show Money Box.

A report from the Association of Letting Agents said that rent levels are not "soaring" as expected, due to more new developments coming on-stream. In London and the south-east, among other places, rental property demand is higher than supply.