» Read the complete article

Buy-to-let landlords are predicting that their portfolios of rental properties will increase in value over the next year as they look to a brighter, better 2010.

According to Paragon Mortgages, landlords have been taking advantage of house price weakness since the first quarter of 2007. They owned an average of 11 properties at the beginning of 2007 and this has increased to 12 properties by the third quarter of 2009 – and those that have made rental profits over this period are those who secured the best buy-to-let mortgages with buy-to-let mortgage advisers.

And landlords think things are on the up across the board – a third of landlords believe that tenant demand will grow over the next 12 months, with 57% predicting it will remain stable, according to Paragon. Housing supply remains tight and mortgage availability is limited and landlords think this means their businesses will remain buoyant next year.

The lender also found that over half of landlords attempted to obtain a buy-to-let mortgage in the third quarter – of those, nearly nine out of 10 stated that it was more difficult to secure a buy-to-let mortgage than in the previous three months.

Getting hold of a buy-to-let loan is tough, there is no doubt about that, but with the help of a dedicated professional it is possible to secure finance on a rental property and it is possible to make decent profits.

Nigel Terrington, chief executive of the Paragon Group says: "A number of factors point to renewed landlord confidence in the third quarter of the year. Landlords expect the net value of their property portfolios to increase over the next 12 months, the first positive prediction for more than two years, and our research shows that landlords not only retained existing properties during that period, they added to their portfolios.

"Landlords are reporting that tenant demand continues to be strong – this has been a recurrent theme throughout both 2008 and 2009 as people are either unwilling or unable to purchase property and decide to rent instead. It is unlikely that the mainstream mortgage market will recover for a number of years and vast sectors of the population, such as first-time buyers and people with impaired credit history, continue to be excluded from the market."

SOURCE: Paragon, 03/11/09

To keep up with the latest News and comment on the UK buy to let market visit the Buy to Let Mortgage Blog