Around 60% of landlords have cited the ongoing demand for rental properties as a key factor in their decision to grow their BTL portfolios, revealed the latest data from Paragon Bank.
According to the lender’s The Next Generation Landlord Report — which surveyed 500 landlords with up to three properties and ambitions to build larger portfolios — the growing tenant demand is making BTL investment as an attractive avenue for aspiring portfolio landlords.
Over half of landlords (54%) are looking to add properties to their portfolios as a means of supplementing their rental income, with over a third of participating landlords (34%) saying they prefer property as an investment asset over other options.
When asked why they chose property over other investments, landlords emphasised its tangible nature (67%), wealth-building potential (54%), and the ability to pass it on as an inheritance (53%).
Family and friends are also a key factor influencing landlords’ decision to further invest in the BTL market, with 43% of respondents citing them as a primary motivation.
In addition, 47% of respondents believe that long-term house price growth is a significant driver for their investment decisions.
Louisa Sedgwick, Paragon Bank's managing director of mortgages (pictured above), said: "The rental market is set for continued growth, driven by projected population increases of around 10% over the next decade — this favourable market outlook is underpinning the investment decisions of aspiring landlords.
"The research also demonstrates a clear focus on long-term planning, with over half of landlords building portfolios to support their retirement.
“This indicates a strong commitment to the rental sector and is essential for the overall health of the PRS.
"The rental market is attracting a growing number of landlords who are inspired by their friends and family or who have discovered the benefits of property ownership through other circumstances.
“These aspiring landlords are committed to providing rental homes for the future and require a supportive regulatory and fiscal environment to continue their investment activities."
