Research undertaken by Paragon Bank has shown that the number of landlords who are planning to expand their buy to let portfolios is higher than those looking to reduce.
The survey of over 900 landlords was carried out by BVA BDRC and was the first time in four years that the results have shown landlords are looking to expand their portfolios.
Of those who completed the survey 19% said it was their intention to invest in property over the next 12 months.
Paragon Bank’s managing director for mortgages, Richard Rowntree noted: "News that for the first time in over four years more landlords are intending on buying than selling is fantastic. This is because not only is it good for the industry but, more importantly, it’s good for tenants."
Demand from tenants in the UK rental market has shown no sign of slowing down either. Propertymark’s March Private Rented Sector Report has revealed the number of prospective tenants in the country has increased for a third month in a row.
Rowntree commented: "It’s fantastic to see that such high levels of optimism have been recorded following the challenges of the past year or so and that this is being driven by strong levels of demand. The extension of the Stamp Duty holiday is certainly a driver of that, but it is underpinned by longer-term demand for rental property."
Increases in demand for rental properties have been especially noticeable in the UK’s cities. These properties have benefitted from a recent relaxation of lockdown rules that has seen many return to the areas to work and socialise.
Nowhere in the country has seen this increase more than London. Data from estate and lettings agency Chestertons showed 38% more tenants were moving into residential properties in the city during March than February and in the same time period 12% more rental properties came to the market.
With more people heading back to their city based offices and businesses opening up again, Corey Askew, Head of Sales at Chestertons noted that: “We are starting to see buyers and tenants returning to more central parts of London in anticipation of returning to their offices in the summer.”
Separate research carried out by Knight Knox found that on average UK landlords earn £20,000 net income per year from renting out their properties. Many landlords have used the stamp duty holiday implemented during the pandemic to purchase more properties whilst taking advantage of significant savings.
88% of the 500 landlords surveyed also stated they were feeling confident or very confident about the buy to let market over the next 12 months. This confidence in the market meant that just 4% of survey respondents said that they were planning to reduce their portfolio size.