Its quarterly research for Q2 revealed that 23% of landlords feel more confident about the prospects for their portfolio.
Paragon found that landlords expect to have an average of 13.1 residential properties in their portfolio in a year’s time, compared to 12.6 at the moment – the first time since 2009 that landlords have predicted a rise.
Indeed, landlords’ perception of the availability of buy-to-let finance rose during Q2, with 22% saying it was ‘reasonably available’ compared to 17% in Q1.
Greater optimism about the buy-to-let sector was twice as strong among professional landlords, with 30% feeling more confident compared to 15% of smaller scale investors.
Paragon revealed that rental income was particularly healthy in Q2, with 29% of landlords increasing their income for the three months to June, with the majority seeing a rise of between 2% and 4%.
Yields remained unchanged at an average of 6.2%.
In addition, 14% of investors in Q2 expected the net value of their portfolio to increase, up from 13% in the first quarter, while those forecasting falls in value dropped 7% to 12% in Q2.
Nevertheless, 74% expect net values to remain the same.
Terraced houses were the most popular property type of those looking to purchase in Q2, with more than half of landlords expecting to buy such a property. Meanwhile, 41% were looking at semi-detached homes, up from 28%, and 22% were opting for detached properties, up from 9%.
Nigel Terrington added: “Landlords are still experiencing high levels of tenant demand which is set to rise further in the coming quarters. It is encouraging to see yields remaining at a healthy level, low void periods and general confidence across the sector.”
