Buy-to-let confidence high

As rental yields remain stable and returns strong in the buy-to-let sector, landlords continue to snap up new investment properties, reports the mortgage provider Paragon.

Apparently undeterred by the base rate rise in August, confidence in rental property seems as strong as ever, with landlords continually expanding their portfolios.

"Investors are attracted by stable rental yields and good overall returns over the short to medium term," explained Nigel Terrington, chief executive of the Paragon Group.

Landlords have been enjoying average rental yields exceeding six per cent this year and, according to the latest statistics, overall returns exceed ten per cent.

"This kind of return compares very favourably with other forms of investment, such as equities, cash deposits or fixed income securities," said Mr Terrington.

He went on to predict that buy-to-let landlords would support an additional 20,000 to 30,000 tenants each year for the next decade, as immigrant numbers grow, house prices rise and debt problems escalate.