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The majority of property managers in the UK are increasingly concerned about how the recession will impact on their business in the year ahead, despite some evidence of sustained demand for residential rental property, according to an industry report by Pi-Property Insurance.

79% of property managers said that they are concerned about what the year ahead holds in store, despite the fact that more than half (55%) expect demand for residential rental property to increase in the year ahead. By contrast, 51% of property managers are expecting demand for commercial property to stay the same or fall in the year ahead.

Don Morrison, managing director at Pi-Property Insurance, says:

“Demand for commercial and residential rental property has become increasingly polarised during the downturn and as a result, some property management companies are more exposed to the effects of the current recession than others.”

The report identifies the top challenges facing property management companies in the current economic climate. Attracting viable tenants is the main challenge according to 62% of the respondents, followed by controlling costs (38%) and reducing risk (30%). Other challenges include staying compliant, despite a growing amount of red tape.

Don Morrison says:

“The industry is striving to balance cost and risk, while staying compliant and reducing the administrative burden on their business.

“With these challenges in mind, one in four (29%) property managers have already identified that insurance is a growing priority and we expect more property managers to review the insurance cover they provide to landlords in the future.”

The recent introduction of FSA regulation controlling the sale of insurance combined with greater cost-sensitivity among landlords, has added to the frustrations for property managers.

Don Morrison concludes:

“Insurance is an increasingly important issue for landlords and property managers alike. While cost is always going to be a big factor, we are finding that more property managers want to provide landlords with access to insurance products that are comprehensive in terms of cover and hassle-free in terms of ongoing service.” 

Pi-Property Insurance provides a range of innovative 21st century insurance packages for property managers, enabling them to access bespoke solutions which are especially suitable for the property portfolios of their commercial and residential landlords.