professional landlords

Professional landlords seizing opportunities in current market

The year ahead could present some strong buying opportunities for buy-to-let investors, with professional landlords in particular expected to remain resilient. 

With more stability returning to the market thanks to falling inflation, greater competition in the mortgage market and growth in buyer confidence, many are hopeful that the year ahead will provide more favourable conditions for investors and the wider housing market.

In the investment space, the latest economic improvements have boosted confidence among buy-to-let landlords, according to the latest figures from Paragon Bank. It found that 49% of landlords think their rental yields outlook is good or very good for Q3, which is up 16% on the previous quarter’s responses.

The study also found that the general confidence of property investors operating in the UK lettings space increased by 8% in Q3 compared with Q2, and 6% more landlords expected to achieve capital gains on their property or properties.

The level of confidence among investors in the buy-to-let space may have been boosted even further since this survey was carried out, according to comments from Richard Rowntree, Paragon’s managing director of mortgages, since the announcement that Section 21 eviction changes would be delayed until court reforms were enacted.

More confident than in 2022

In a sign of how the outlook has improved over the past year in terms of investor confidence, Paragon Bank points out that optimism is higher now than it was a year ago “about all aspects of letting, with the exception of capital gains…particularly with respect to rental yields.”

Paragon Bank managing director of mortgages Richard Rowntree says: “Landlords play a vital role in the UK’s housing provision, so it is important that they feel confident in the investment environment, particularly at a time when demand continues to outstrip supply.   

“Although there is still work to be done on all sides as we work to improve the private rented sector for both tenants and landlords, we’re encouraged by signs that the value of private investment is being recognised by government.”

This is a message that has been echoed by a number of industry body in recent years, as the gap between supply and demand has grown wider than ever, creating a difficult market for tenants.

For example, research from the NRLA found that rental demand has tripled since the pandemic, while there is some evidence that landlord numbers have dwindled at the same time. The body has called on the government multiple times to bring in more measures to encourage investment from landlords, to provide more homes for tenants.

“Resilient” professional landlords will push ahead

Despite the recent difficulties faced by many of those involved in the housing market, from homeowners to investors and even tenants, professionals in the buy-to-let space have remained resilient, according to Nigel Terrington, Paragon Bank CEO.

He states that he is currently optimistic about the rental space because of this resilience among professional landlords, and believes that this outlook is set to continue, with professional buy-to-let owners being able to look at the current environment as a “buying opportunity”.

Rental yields are strong at the moment, he acknowledges, while softening house prices and mortgage rates are all providing an additional boost to the market and encouraging buyers to seek opportunities.

“I think the conditions are kind of quite favourable for that,” he said.

Stability and certainty will both be key factors affecting what happens in the market in the new year, added Terrington, and commenting on the latest inflation news he stated that “the medicine appears to be working”.

“I think we’re quietly optimistic without getting carried away, but like all businesses and all people we just need some certainty,” he said.

Self-certified Sophisticated Investor

Please read

I declare that I am a self-certified sophisticated investor for the purposes of the restriction on promotion of non-mainstream pooled investments. I understand that this means:

I am a self-certified sophisticated investor because at least one of the following applies:

I accept that the investments to which the promotions will relate may expose me to a significant risk of losing all of the money or other property invested. I am aware that it is open to me seek advice from someone who specialises in advising on non-mainstream pooled investments.

High Net Worth Investor

Please read

I make this statement so that I can receive promotional communications which are exempt from the restriction on promotion of non-mainstream pooled investments. The exemption relates to certified high net worth investors and I declare that I qualify as such because at least one of the following applies to me:

STAY AHEAD OF THE MARKET

Sign up for first access to new developments and exclusive property investment opportunities.

We send limited and targeted emails on new launches and exclusive deals which best fit your areas. We are trusted by over 30,000 active buyers as their source for new stock.

  • New property developments
  • Professional market reports
  • Property deal alerts
  • Development updates
Manchester property investment

FIRST FOR NEWS AND KNOWLEDGE.

Receive trending news straight to your inbox and stay up to date on all of the property market trends and advice.

Established since 2005 we are a leading voice of authority and commentary on the UK property market. Our news is trusted by Apple News & Google News.

  • UK housing market
  • Mortgage & money
  • Buy-to-let landlords
  • Guides & advice

Talk to us

Speak to our UK property experts today:

 

+44 (0) 333 123 0320

Open from 9am-6pm GMT

 

+852 6699 9008

Open from 9am-6pm HKT