Despite the range of government measures looking to dampen down buy-to-let, landlords have grown more confident in how their portfolios will perform according to Kent Reliance’s Buy to Let Britain.
In the second quarter 39% were confident in the state of their portfolios but that proportion rose to 54% in the third quarter.
Andy Golding, chief executive of OneSavings Bank, parent of Kent Reliance, said: “Property investors have had to roll with punches in 2016.
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“The stamp duty levy clearly took its toll on the market, and combined with the forthcoming tax changes, landlords have felt at the mercy of a political agenda.
“But confidence is returning as landlords take action to limit the damage to their finances.”
More landlords are taking out mortgages through a limited company, as there were 100,000 transactions through limited companies in the first nine months of 2016, double the total for 2015.
Annual rent inflation currently stands at 2.4%, but a third of landlords expected them to increase rents in the next six months alone by an average of 5.4%.
For two thirds this was because of higher future taxes and for 43% the strength of tenant demand. Indeed, twice as many landlords are seeing an increase in tenant demand than the number seeing a reduction.
Next year the Prudential Regulation Authority’s new underwriting standards are due to be implemented, the reduction in mortgage tax relief will start taking effect and the FPC has the power to intervene further.