Landlord confidence reaches five-year high

Landlord confidence reaches five-year high

Managing Director Kate Randall believes the private rented sector is emerging from the pandemic “stronger than ever”.

Despite Covid-19, and the other economic disruption over the past five years, confidence among landlords is at a record high, according to new research.

A survey from Paragon Bank showed that 48% of landlords either felt ‘Good’ or ‘Very Good’ about their property business prospects.

That compared with just 19% the last time the survey was carried in 2016.

 

The survey asked more than 600 UK landlords for their expectations on:

 

  • Rental yields
  • The future of their property businesses
  • Capital gains
  • The private rented sector as a whole
  • The wider UK financial outlook

 

The survey of landlords revealed:

 

  • 48% had ‘Good’ or ‘Very Good’ expectations for their portfolios
  • 47% had ‘Good’ or ‘Very Good’ expectations for capital gains
  • 26% had ‘Good’ or ‘Very Good’ expectations for the UK financial market
  • 38% had ‘Good’ or ‘Very Good’ expectations for the private rented sector
  • 56% with 11 or more properties in their portfolio felt ‘Good’ or ‘Very Good’ about their business prospects
  • 46% with between one and 10 properties felt ‘Good’ or ‘Very Good’ about their business prospects
  • 63% who had recently purchased a rental property felt ‘Good’ or ‘Very Good’ about their business prospects
  • 78% with plans to expand their portfolio over the next 12 months felt ‘Good’ or ‘Very Good’ about their business prospects

 

Kate said: “The sense we’ve been getting from our own landlords for some time is one of great optimism and this is reflected in the results of the Paragon survey.

“The pandemic has been a test for landlords and the private rented sector as a whole, but it’s a test we’re coming out of in a much strong position.

“For landlords, property remains an excellent driver of income and a reliable, secure asset class for long-term pension provision.

“For renters, ongoing improvements to the sector are benefiting them, too, so it’s also no surprise to see tenant demand in the UK so high.”

Richard Rowntree, managing director for mortgages at Paragon, said: “Understandably, landlord confidence fell sharply in the first quarter of 2020, as the extent of the pandemic became clear.

“It is fantastic to see optimism bounce back and rise in the time since.

“It is an indication of the strength of the sector. Landlords see the sector’s issues and opportunities daily, so measuring their outlook can provide useful insight for the industry and, as we see here, investor confidence can have a real impact on behaviour.”