Landlords are making 6.3% per year on their property investments, according to a report from lender Foundation Home Loans.
Property investors typically borrow £665,000, which equates to £125,000 per buy-to-let mortgage. However portfolio landlords borrowed well in excess of £1 million.
Grant Hendry, director of sales at Foundation Home Loans, said: “Despite a challenging market environment, landlords are finding ways to maintain profitability and expand their portfolios.
“Average rental yields increasing, the ongoing preference for limited company ownership and high tenant demand are all encouraging trends which keep on emerging and should provide mortgage advisers with opportunity to secure business and help landlords navigate the market.
“In an interest rate environment which has seen some falls already, we believe the opportunity to remortgage is now greater than in the last couple of years, and we’ll see a growing cohort of landlord borrowers able to remortgage to a different lender rather than simply have to accept a product transfer.”
Despite this positivity, only 10% of landlords plan to increase the size of their portfolio in the next 12 months.
In terms of their concerns, the potential introduction of rent controls and the scrapping of Section 21 are the biggest.
The research was contained in the Q2 2024 Landlord Trends report, conducted by Pegasus Insight and issued by Foundation Home Loans, which is based on 799 online interviews with landlords in June and July.