Only 6% of the landlords surveyed thought that tenant demand would decline in 2012.
Last year 45% of landlords said they expected tenant demand to either grow or boom during 2011.
This year 45% of landlords expected rental income to increase during the next 12 months whereas 53% said that it would remain stable and only 2% expected it to decrease.
Two thirds of landlords said that they thought arrears levels would stay stable and a fifth said that they thought arrears would rise moderately.
Nigel Terrington, chief executive of Paragon Group, said: “It is no surprise that landlords are expecting a healthy level of tenant demand in the New Year, based on the levels of demand we have seen steadily increase throughout the past 12 months.
“2011 was certainly a good year for the buy-to-let market with not only increasing tenant demand but landlords investing in their portfolios, low levels of arrears and more available finance.”
Terrington added that with the success of 2011 to build on, he believed the private rented sector would continue to perform and provide a valuable tenure choice for even more people in 2012.
He said: “This year will bring its own challenges, especially with the uncertainty in Europe and the wider financial markets affecting overall confidence levels.
“But I believe that the foundations that we laid as a sector in 2011 will allow lenders and landlords to continue to do business, in particular if we see a greater level of product innovation.
“We should look to 2012 with optimism as it is sure to bring further opportunities.”
