The latest figures from the Council of Mortgage Lenders (CML)
show that in April there was a 43% increase in the number of buy-to-let loans
originated, compared with April 2013, and a 57% increase in the value of
lending.
The latest survey results from Paragon show that landlords
are feeling optimistic when it comes to the
prospects for the market and their rental portfolios. Those surveyed reported an increase in the average value of their rental portfolios, from £1.56 million in Q1 2014 to £1.60 million in Q2 2014.
The average annual void period has also fallen in the second
quarter, from an average of 2.8 weeks in Q1 to 2.7 weeks. There is a clearly
established downward trend in the average length of void period. Since 2011
void periods have remained consistently low, only fluctuating between 2.6 and
3.0 weeks. There are several factors that contribute to short void periods such
as high tenant demand and good working relationships between landlords and
letting agents.
Gross yields remained much the same in the second quarter with
landlords reporting an average of 6.2%, which is not dissimilar to the levels
seen throughout 2013. In the next 12 months landlords expect this average gross
yield to remain stable.
In terms of property purchasing behaviour, 16% of landlords
are planning to buy additional buy-to-let property in the third quarter, and of
those looking to buy, more than half (54%) expect to buy terraced houses.
Source: PRS TRENDS report by Paragon Group
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