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More than three quarters of landlords in the nation's capital believe London is the place to invest in right now as they hopefully look to a price hike in the coming 12 months.

Latest results from London property firm The Young Group’s regular survey into the London buy-to-let sector has found that landlords all over the country are more confident of better buy-to-let times to come – 51% of UK landlords expect property prices to stay where they are or even rise in the next year, that's up from just 12% of UK landlords a year ago.

But despite this increasingly positive 12 month outlook, the expected pace of market recovery remains fragile. Landlords forecast an average property price rise of less than 1% for London property.

Neil Young, chief executive of Young Group says: “From a practical point of view, it appears that landlords are fully aware of
the current difficulties in securing buy-to-let mortgage funding to acquire additional rental property and the proportion of those who expect to add to their property portfolios is levelling off.”

Young says that the restrictions in buy-to-let mortgages is not an issue – it says the effect of reduced mortgage finance in bolstering the rental market. Reluctant tenants – those who would like to buy property, but are hampered by the current economic situation – are bolstering the rental market. Young London’s letting team has seen tenant enquiries rise by 24% over the past quarter alone and the occupancy rate for property let through Young London is currently higher than 99%.

Young adds: “Landlords with the right property in the right location who are realistic about their rental expectations are benefiting from the current market conditions, seeing positive cashflow as a result of low interest rates and rental income that has not significantly reduced."

SOURCE: Young Group, 23/09/09

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