Increasing tenant demand for landlords

16.05.2006 Over the past six months landlords have seen an increase in tenant demand and achievable rents, according to research from the specialist buy-to-let lender, Paragon Mortgages. According to the lender, a quarter of landlords reported an increase in tenant demand and two thirds felt the demand was stable.

This comes as refreshing news in the wake of HMO legislation introduced last month. The new licensing affects houses which are deemed to be in multiple occupation, and requires landlords to comply with new safety requirements. A third of landlords feared the changes could be difficult.
Paragon’s survey also showed that annual void periods have fallen; the average period is now 2.8 weeks as opposed to three weeks a year ago. Landlords have been predicting an overall increase in the net value of their properties of 5.6 per cent over the next twelve months.
As it stands, the majority of landlords achieve gross rental yields of between 4 and 7 per cent with an average return of 6.3 per cent. Those who responded to the survey said they expected gross yields to rise to 6.4 per cent over the next 12 months.