Paragon: Buy-to-let boosted by tenant demand

12 September 2007
A slowing housing market is fostering tenant demand and pushing up rents, according to industry experts.

Landlords can expect their portfolios to increase by about five per cent over the next year, buy-to-let lender Paragon has said.

Property investors will own 12.1 houses against today's figure of 11.5 and the value of the portfolio will be worth about £1.5 million in 12 months.

Chief executive Nigel Terrington said: "The private rented sector continues to expand steadily to meet this growth in demand for accommodation and landlords add to their portfolios in the knowledge that tenant demand is buoyant and rents continue to rise."

The Royal Institution for Chartered Surveyors (Rics) said that rents were growing at record levels and predicted that demand for rented properties would increase in the autumn as first-time buyers delayed their purchases.

Rics spokesperson Jeremy Leaf said that economic uncertainty was an ideal arena in which buy-to-let investors could cash in on rising rental levels and rising rents offered "some compensation" for landlords with higher borrowing costs.

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