48% of landlords think now is a good time to invest, according to latest survey
72% of landlords are planning to maintain or expand their portfolios as rental demand remains high
The number of landlords who believe that now is the right time to invest in the buy-to-let market has grown over the last quarter, thanks to the continued growth in tenant demand...
Some 48% of landlords surveyed in Q3 think that now is a good time to invest, which compares with just 42% in Q2, according to the latest sentiment survey from LSL Property Services. Almost three-quarters (72%) of landlords polled by the group are planning to maintain or expand the size of their portfolios over the next 12 months, with just 1% believing that now is a good time to reduce their portfolios.
In the past three months, 50% of landlords have seen a rise in tenant demand and 69% expect tenant demand to grow in the next 12 months. The latest LSL buy-to-let index reveals that continued demand has resulted in rents hitting a record high, of £689 per month, following eight consecutive months of rises.
David Newnes, estate agency managing director of LSL, says: "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. The government’s spending review last month is expected to swell the ranks of tenants as potential social tenants opt to enter the private rented sector, instead of facing long waiting lists for social housing where they can expect to pay 80% of market value. 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.”
Mortgage finance continues to be the biggest obstacle to greater investment for landlords, with only one in 20 (4.8%) of those polled believing it is now easier to obtain mortgage finance than it was a year ago.
Separately, national lettings franchise, Belvoir, has revealed that its average rent has risen from £695 to £700 this year, with its network fee having hit a record high of 9.8%.
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