Protecting your investment: How can you secure your property portfolio?

Owning an investment property is one of the biggest assets most Australians will purchase in their lives. Real estate ownership can be an extremely lucrative and profitable business if the right steps are taken to ensure the quality of the properties is maintained. 

There are a number of different avenues for protection that can be undertaken, which will help you keep your investment portfolio in the best condition possible. 

Lenders mortgage insurance

If you're hoping to borrowing more than 80 per cent of a property's value with your home loan, you'll have to pay for lenders mortgage insurance (LMI). This is to protect the lender in the unfortunate event that you're unable to make your full repayments. 

Home insurance

But the big one to consider for your investment properties is home insurance. These policies can be taken out for a wide range of different events, which will help to provide you with peace of mind – regardless of what happens. 

Most of these products protect against unforeseeable events such as extreme storms, avalanches, fires, flooding and other acts of God that cannot be adequately protecting against. Furthermore, these policies can often be extended to cover any damage or losses caused by tenants. 

For example, depending on the terms of your insurance, some policies will reimburse landlords for lost rent in the event that tenants leave the home without providing adequate warning. These expenses can potentially be covered until new tenants are found – which is great news for investment property owners, who will otherwise be losing money on property upkeep. 

One thing to remember is that your home insurance only covers the property, not your tenant's belongings. Therefore, it could be a good idea to recommend they get their own protection policies.