Landlords have mixed feelings about the way buy to let is going for this year, according to a new survey.
Opinions are evenly split - with 50% reporting tenant demand growing in the final three months of 2011, while the other half reckon it stayed the same or dropped.
The conclusion comes from the latest private rental sector survey from buy to let and HMO lender Paragon Mortgages.
The lender also reports just over half of landlords (56%) believe demand from tenants will continue to grow throughout 2012.
On the back of that optimism, a fifth (20%) of landlords are planning add more rental property to their portfolios by Easter.
They are most likely to buy terraced homes (64%), with semi-detached houses (28%) the next favourite and then flats (21%).
Yields averaged 6.6% in the last quarter of 2011 - up from 6.1% in the previous three months.
Nigel Terrington, chief executive of Paragon Group, said: “The final quarter of last year proved to positive for landlords and for many, the most successful quarter of the year. It is no surprise with the ongoing pressures on the wider housing sector that landlords are still experiencing increasing tenant demand, which looks set to continue throughout the coming 12 months.
“It is also interesting to see landlords expect 2012 to be a steady, stable year with continuing opportunities to achieve healthy yields and make further property purchases.”
The lender also quizzed landlords about the availability of buy-to-let finance during last quarter of 2011 - with 27% stating mortgages were widely or reasonably available, with 35% saying availability is limited.
Meanwhile, Precise Mortgages is urging investors to look out for bridging firms charging interest from the start date of a loan rather than from the date the money is released.
Precise claims they spotted the anomaly last year when quoting a £1.9 million loan over 12 months.
Both lenders quoted at a rate of 1.15% per month, but Precise charged £28,400 interest for the same loan over the same term because of the different start date of the borrowing.
