Landlords' confidence returns

Residential landlords are beginning to feel optimistic about house prices for the first time in more than two years, according to a report from Paragon Mortgages.

An increase of 0.8 per cent on the value of properties is now expected over the next 12 months, after what the Residential Landlords Association described as "two years of relative pessimism".

The latest quarterly report from Paragon also suggested there is a belief among landlords that the bottom of the housing market has been reached.

The average portfolio has increased from 11 properties in 2007 to 12 properties this year as landlords have been taking advantage of the weaker market.

John Heron, managing director at Paragon, said: "House prices have fallen steadily since the end of 2007 and this is reflected in landlords' expectations for the future value of their portfolios.

"Interestingly, landlords have not generally seen falling house prices as the catalyst to sell property and have used weaker prices to add to their portfolios."

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