12:07 PM, 24th November 2010, About 13 years ago
Almost a third of buy to let landlords would like to add more letting homes to their portfolios to expand their businesses to meet soaring tenant demand.
Half of landlords are reporting surging interest from tenants in the last quarter, while seven in every 10 expect the demand to continue for the coming year.
Although 71% of landlords believe it is more difficult to secure a buy to let mortgage now than it was a year ago, just under half of landlords revealed they thought it was a good time to invest in property, while only 1% believed they thought it was a good time to reduce the number of properties in their portfolio.
About 28% of landlords are planning to buy more properties over the next year, while 43% intend to keep their property business at the same size.
The combination of increased demand and a growing shortage of rental properties have pushed rents to a record high of an average £689 in the quarter. Despite higher rents, landlords are confident voids are decreasing due to demand.
The data comes from a survey of the rental market for the quarter ending October 31 by LSL Property Services.
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.”
Mr Newnes also revealed 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 added: “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.”
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