Landlords in the East of England are the most positive about the future while also reporting strong tenant demand, new research shows.
The survey carried out by BDRC on behalf of lender Paragon also shows that overall landlord confidence across a range of measures remained stable or increased in the first quarter of 2018 compared with the end of last year.
While still weak compared with historic levels, this quarter’s figures make welcome reading after a sharp dip in confidence following the announcement of new tax measures for landlords in 2015 and a further fall after the introduction of tighter underwriting rules for buy to let mortgages last year.
Landlords in the East of England were most positive about the future, with over half, 53%, of those surveyed indicating that they felt upbeat about the prospects for their own lettings business over the next three months.
The business prospects for landlords in this region were supported by strong tenant demand, with 81% noting that demand for rental accommodation in the area they let property was either stable or increasing.
Similar levels of demand were recorded in the East and West Midlands where 81% and 76% of landlords respectively reported stable or increasing tenant demand.
The East and West Midlands also ranked among the top five regions in England and Wales for rental yield and capital gains. Typically, higher yields are seen in areas where capital values or the outlook for capital gains are weak or vice versa.
This quarter’s results show landlords in central London are currently least optimistic, with only 26% rating prospects for their own letting business as good or very good over the next three months.
Fewer landlords in central London reported tenant demand to be stable or increasing than in any other region and were also most likely to have reduced rent in the last 12 months.
‘After an unprecedented level of change, it’s encouraging to see landlord confidence stabilising this quarter. At a regional level, the East of England and the Midlands look well supported, with encouraging data on tenant demand, yield and capital gains while the London market adjusts its footing after many years of strong growth,’ said John Heron, managing director of mortgages at Paragon.
