Research by buy-to-let mortgage firm Paragon rising optimism among landlords but with surprisingly wide regional and business sector differences.

Landlords in the South West and East Midlands are most likely to be feeling good about their business and predicted yields over the next three months, while those in central London and the North West most downbeat about their balance sheet.

In its quarterly market overview, buy-to-let mortgage provider Paragon reports that it’s not all doom and gloom in the sector, with those renting out 11 or more properties the most positive about their prospects.

Interviewing nearly 800 landlords, it found 42% in the South West rated business expectations as good or very good in the next three months compared with 23% in the North West.

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Boris bounce

The Boris Bounce seems to be filtering down into the private rented sector generally, as Paragon found a big jump in landlord confidence in the UK financial market, with 24% rating its prospects as good or very good compared to just 9% in Q3.

And although they’re less optimistic about the prospects for yields, landlords still believe both rents and property prices will increase as a direct result of the election; a quarter of respondents said rents would rise, compared to 1% who predicted a fall.

Richard Rowntree, Paragon managing director of mortgages, welcomed the green shoots of recovery in confidence after several quarters of declining optimism.

“Although still low compared to historic levels, a more certain political and economic landscape will hopefully provide the platform for confidence to continue to grow,” he says. “Although tenant demand has remained strong, landlords have had to weather a myriad of regulatory and tax changes over the past five years, so they will be looking for Government to allow those changes to fully bed in and for a period of consistency.”

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