Buy-to-let landlords suffer as crunch bites

Optimism among buy-to-let landlords in the UK property market is at the lowest level recorded in the past twelve months, according to a new survey.

Compiled by buy-to-let mortgage broker the Money Centre, the research shows 48 per cent of landlords were concerned over the future of the market.

However, despite pessimism in some quarters, 52 per cent of landlords still believe their prospects are good or very good.

A fifth of all landlords are also currently looking to buy more property.

"Buying property is always best viewed as a medium to long term investment option and that is how most buy-to-let landlords see it," said Lynsey Sweales, director of the Money Centre.

"The research shows the average length of time landlords expect to be in letting is 17.5 years, which is why scaremongering over house prices dropping is not a major concern for professional landlords."

The research also finds over half (54 per cent) of landlords believe property offers a strong or reasonable potential for growth when compared to other forms of investment.

This compares to December 2007, when ten per cent fewer landlords were positive about the potential of property.

Rental yield expectations are also picking up since the end of last year.

There is a slight increase in the number of landlords who state their expectations are very good, and the number of landlords who felt expectations are very good or good has remained static at 61 per cent since December.

"We think there is good opportunity for most landlords to achieve increased rental yield in the coming months," said Mr Sweales.

"A lot of people seem to be postponing buying property until the market situation becomes clearer regarding prices which means more people are looking to rent."

The top five cities for buy-to-let investment were found to be London, Glasgow, Manchester, Birmingham, and Cambridge.

Chris O'Toole