Landlords confident in the future

Despite rising interest rates, a new study shows that landlords are confident that their properties will remain profitable in the future.

Figures from Paragon indicate that landlords believe their portfolio of property will increase in value over the next 12 months. In fact, the firm's buy-to-let index has jumped five points since the last quarter.

Landlords are particularly confident because tenant demand has continued to outstrip supply - meaning that they have been able to increase rents in the face of rising interest rates.

As a result, average yields for landlords with three or more properties have actually increased - from 6.1 per cent in February to 6.3 per cent.

In addition, many landlords have taken advantage of slowing house prices to add to their portfolio. Typically, a professional landlord now owns 11.5 properties, but they expect to have 12.5 in one year's time.

"Landlords are confident because tenant demand is strongly underpinning the market," explained John Heron, managing director of Paragon Mortgages.

"Young people are choosing to stay in rented accommodation for longer, while there are a growing number of students and immigrants who are fuelling demand for rented property."

Mr Heron concluded by pointing out that rental property is becoming "an increasingly important part of the UK housing market".

See how a property management system makes property management easyThis article was brought to you by Rentman, the premium rent management software