2 September 2014
Nearly a third of landlords are looking to increase the number of properties they have as demand for rented accommodation soars, research indicated today.
Around 28% of buy-to-let investors are planning to buy more properties during the coming
Landlords' confidence is being driven by growing demand for rental property, with 50% of landlords seeing an increase in the number of people who want to let a home during the three months to the end of October, while 69% expect demand to continue to grow during the coming year.
The increase in demand, combined with a shortage of rental homes, pushed rents up to a record high of £689 a month in September, following eight consecutive months of rises.
Landlords are also increasingly confident that their properties will not be empty for long periods in between tenants.
Just under half of landlords said they thought it was a good time to invest in property, while only 1% said they thought it was a good time to reduce the number of properties they have.
David Newnes, estate agency managing director at LSL, said: "Optimism is growing amongst landlords underpinned by very strong tenant demand, which has pushed up rents to new heights.
"With mortgage lending conditions so tight and uncertainty over the direction of house prices, many would-be buyers are choosing to stay in the private rented sector for the time being.
"The majority of landlords anticipate that tenant demand will increase further in the next year."
He said the Government's announcement in the Comprehensive Spending Review that new social housing tenants could be charged rents equivalent to 80% of what they would be charged to rent privately was likely to further boost demand, as people opted to rent privately rather than face long waiting times for social housing.
He said: "An increase in the supply of rental accommodation will be necessary to meet this demand - and many landlords recognise this as an opportunity for investment"
But landlords who want to buy more properties are continuing to face problems as a result of the ongoing shortage of buy-to-let mortgages.
Around 71% of landlords who recently tried to get a mortgage said they thought it was now more difficult to borrow money than it was a year ago, with only 5% saying it was easier.
But there is some evidence that the situation may be beginning to ease, with a number of new buy-to-let products launched by lenders in recent weeks.