In the first quarter of 2014 over four in 10 landlords were more optimistic about the prospects of their property portfolios, with large-scale landlords showing the highest levels of positivity.
Landlords expect to see a 5.6% increase from their buy-to-let investments in the year ahead, an increase on 3.5% three months ago.
They are particularly positive about tenant demand, with 36% saying it is growing or booming.
John Heron, managing director of Paragon Mortgages, said: “We have seen a steady improvement in confidence among landlords over the past year as the housing recovery has gathered pace.
“Whilst market data would suggest that we are a long way from “boom” territory, this optimism among landlords is key to maintaining balance in the housing market and in ensuring that renters’ have more choice.
“To support this we need to continue to see the sort of progress that we have seen from buy-to-let lenders over the last year with further measured and responsible development of products and criteria.”
Surprisingly over the last three months the average market value of residential landlords’ property portfolios fell by 7.1% from £1.68m to £1.56m, reversing the trend seen in the previous two quarters.