Bright buy-to-let future bright

Buy-to-let landlords remain confident over the future of the UK investment market, according to the National Landlords Association (NLA).

With both rental yields and returns showing dramatic increases over the course of 2007, landlords are optimistic over the future, despite concerns of price moderations in the wider market.

According to figures from Paragon Mortgages the average rent increased by 19.4 per cent over 2008 - increasing by 8.1 per cent in the final quarter alone.

The same research also found the typical return on a buy-to-let investment was some 21 per cent in 2007.

"These figures show professional landlords remain confident about the market and are firmly committed to providing decent and affordable accommodation to those who choose to rent," said NLA chairman, David Salisbury.

"It corresponds with recent research from the NLA that over a quarter of landlords expect their portfolios to expand considerably over the next five years."

Furthermore, a slowdown in the wider market, with both Halifax and Nationwide showing annual growth slowing, are not discouraging investors.

"Healthy rental yields are critical to encourage more and more investment in residential property, none so important as when the market is slightly cooling," concluded Mr Salisbury.

"The chances are that, in the coming months, there will be increasing demand placed on the private-rented sector and well-managed portfolios can only serve to benefit both tenants and landlords alike."

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