Some landlords 'are struggling to cover mortgage repayments'

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A new study has suggested that many landlords are not receiving enough rent to cover the costs of their mortgages.

Heritable Bank found that one in ten property investors think that their rental incomes are less than they payout to cover their mortgages. Another third are only just generating enough income to cover their costs.

However, the bank discovered that 43 per cent of buy-to-let investors are relying on house price rises to generate their profits and only 15 per cent are principally focused on rental incomes.

"Three out of four property investors place at least as much importance on the future value of their properties as on generating enough income to cover their mortgage," added Adrian Scott, managing director of residential mortgages at Heritable Bank.

"The outlook for the property market is mixed, with price growth having slowed in most regions.

"This is an ideal time for professional mortgage advisers and expert lenders to help investors squeeze latent value out of poorly structured buy-to-let portfolios."

Mr Scott said that landlords could consider restructuring their overall portfolio financing deals to generate better returns.

Recently, Ernst & Young's Item Club predicted that house prices in the UK were unlikely to suffer a major crash.

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