Just 14% of landlords look to expand

A tiny minority of buy-to-let landlords are looking to expand their property portfolio in the current climate, according to new research.

Buy-to-let specialist lender Paragon finds just 14 per cent of landlords are looking to expand, as prices fall.

Of this group, however, 71.4 per cent argue an ability to secure lower prices on properties will spur them to grow their portfolio over the next twelve months.

Sitting tight appears to be the most common decision among landlords as the market continues to deteriorate, with 67 per cent of buyers claiming they are not looking to either buy or sell property.

This highlights the stability the private rented sector is providing the housing market with at present, argues Paragon.

"Now is a good time for landlords to tweak their portfolios and dispose of properties that aren’t performing as they would have hoped, while picking up property at cheap prices to bolster their portfolios," said John Heron, managing director of Paragon Mortgages.

House prices have fallen 8.8 per cent over the last year, according to research from Halifax.

High tenant demand is also an important factor in the decision to buy, argues Paragon.

Some 39.3 per cent of landlords suggest it will make them consider expanding their portfolio, while a quarter said that rising rents were a contributing factor to a potential purchasing decision.

"Tenant demand is very high, rents are rising and buying opportunities are presenting themselves in a cooling housing market," added Mr Heron.

"Professional landlords are using current market conditions to get ahead. With an average portfolio gearing of just 36 per cent, they are well placed to free up equity to expand their portfolios and this is action we are seeing landlords take."

Chris O'Toole