Rental demand keeps landlords costs down

The buy-to-let sector is providing housing market stability, as landlords are able to raise rents to absorb interest rate increases.

Paragon Mortgages,which specialises in buy to let mortgages reported that rental incomes have risen by 5.0% over the past year from £10,392 to £10,914.

The best performing regions for buy to let were London (£21,696), the South West (£12,545) and the South East (£10,814). The region with the highest annual increase was Yorkshire with growth of 27%.

At 6.5%, terraced houses continue to bring in higher yields than other types of property. Semi-detached homes gernerated average yields of 6.3%, but detached houses and flats have below average yields of 5.9% and 5.4% respectively.

Elsewhere, average property value has grown from £179,793 to £181,533 in July. Investment property values have risen 5.5% over the year, roughly in line with rental incomes.