Two-fifths of landlords felt optimistic about the prospects for their portfolio, a Paragon study found. By contrast, only 30% felt optimistic in the first and second quarters of 2013.
Meanwhile, average yields remained strong at 6.1%, Countrywide research revealed. Wales saw the highest yields at 6.6%, followed by the Midlands and the North.
Properties with one or two bedrooms enjoyed higher than average yields, at 6.8% and 6.4% respectively. However, yields for properties with four or more bedrooms were low at 5.4%.
The study comes as gross buy-to-let lending jumped 28% year-on-year to hit £5bn in the second quarter of 2013.
The Buy to Let Business managing director Ying Tan said brokers and landlords had every reason to be optimistic: “House prices are good and at the moment there is no expectation they will fall. There is no expectation interest rates will go up any time soon. Yields are strong.
“Put that together and that is why you get so much confidence among brokers and landlords.”
Business had hit record levels over the past six months as landlords remortgaged to take advantage of the low rates, he added.
Across the UK, rents increased 0.1% in August, the Countrywide research found. The Midlands and Scotland saw the highest month-on-month jump.
However, rent arrears also climbed. In Scotland, 10.2% of total rent collected was 30 or more days late. In Greater London, the figure was 9.1%. Landlords in the South West enjoyed the lowest arrears rates, with only 6.5% of rent still in the hands of tenants.
Countrywide group commercial director Nick Dunning said the start of a new school term meant August was traditionally a busy time for the rental market: “However, demand is not being met by supply and currently there is a particular lack of family-sized properties available to rent, especially in the South of England.”
Accidental landlords were taking advantage of the improved market conditions and selling their properties, he said, and this meant rental properties were even more scarce.
