In November 2006, the average number of properties owned by a landlord stood at 10.2, a figure which rose by February to 11.1. In addition, the average portfolio value has risen 7 per cent in that time.
John Heron, managing director of Paragon Mortgages, commented: “Our buy-to-let index has shown that in recent months rents have been rising faster than house prices. Because of high tenant demand, landlords are able to achieve strong rental incomes and good yields – and are responding by extending their portfolios.”
Not only have landlords grown their portfolios in recent months, but they expect to own even more properties in 12 months’ time; on average the number of properties across a portfolio is expected to rise by 8 per cent. This is a larger increase than was forecast last quarter – indicating that recent interest rate hikes are doing nothing to deter buy-to-let investors.
John Heron concluded: “On average these landlords have been in the market for in excess of 13 years. They are experienced and have been successful by keeping their fingers on the pulse of the market in which they operate. Their confidence is a good indicator of current conditions – and their confidence is high. They know that tenant demand is pushing rents and yields upwards and remain confident in the long term capital appreciation of their current properties. They fully expect to continue expanding their portfolios in both size and value over the next 12 months.”
