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6 September 2011

Landlords keener on family homes

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by Gill Montia

Landlords keener on family homes

Family-sized homes are gaining in popularity with landlords, as the UK’s private rental sector enters its latest phase.

Research from buy-to-let mortgage specialist, Paragon, suggest that landlords looking to expand their portfolios this autumn are more likely to be considering semi-detached and detached properties for investment.

Forty-one per cent of landlords with a purchase in mind are likely to be looking for semis (up from 28% back in the Spring) while 22% are aiming for a detached property (up from 9% earlier this year).

Currently nearly half of landlords have families as tenants, making them the fourth-largest tenant type.

With strains on the social housing sector, mortgage lending in the doldrums and continuing economic difficulties, more families are sure to be visiting lettings agents and hopefully landlords will be able to react quickly to the changing demographic as rent rises look set to continue for the remainder of 2011.

According the latest survey from the Royal Institution of Chartered Surveyors (RICS), new landlord instructions edged up slightly in the summer but with tenant demand still running well ahead of supply.

Surveyors also reported that where tenancies are coming up for renewal, some landlords (particularly those in London and the South East) are opting to put their properties up for sale.

Other emerging trends include a rise in the proportion of tenants relying on housing benefit, with social lettings in the private rental sector currently at their highest level since 1999, when the RICS began collecting figures.

Thirteen per cent of all new lets currently fall into this category.

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