‘Profitability highest since early 2022’ report landlords
Returns for landlords during the third quarter of 2024 have reached their highest since early 2022 according to research by Paragon Bank.
A survey of landlords carried out on behalf of Paragon has revealed that nearly 90% reported making a profit in during the third quarter of this year, the highest since the beginning of 2022.
Paragon director Anderson (pictured) says it is clear evidence of the market’s stabilisation over the past 18 months. Overall profitability in Q3 2024 is seven percentage points higher than the same period in 2023, following successive quarterly increases.
The figures are made up of 17% of landlords who report making a large profit and 70% a small profit. And the proportion of landlords who made a loss fell during the quarter to 4% from 6% in Q2 and 8% during the same period last year. The remaining 9% of landlords broke even.
Analysing the data at a regional level reveals that net returns are highest amongst landlords operating in the East of England, with 90% recording making a profit.
Strong demand for rented homes against a backdrop of an improving economy as inflation has fallen.”
Above-average levels of profitability were also achieved by lettings business owners in the South West and East Midlands, at 89% and 88% respectively.
Students properties were the most profitable (91%), followed by homes for families with children (88%) and couples (87%).
Russell Anderson, Commercial Director for Mortgages at Paragon Bank, said: “While landlords have faced rising costs over the past two years, these findings support our belief that many have astutely managed their businesses to remain profitable and are now seeing improved returns.
“It’s likely that a key influence of this is the strong demand for rented homes against a backdrop of an improving economy as inflation has fallen.”
