According to research from specialist mortgage broker Mortgages for Business, 55% of landlords are planning to expand their property portfolios over the next six months.
Only 6% of landlords said they are planning to trim their portfolios over the next six months.
218 investors were polled in the research which showed attractive yields were encouraging landlords to expand portfolios further.
Residential yields are particularly attractive with 88% of those planning to invest said they planned on buying residential property. Yields are currently 6.7%.
Other investments were less popular with investors although 26% planned to purchase houses in multiple occupation and 16% in multi-unit freehold blocks.
Commercial property looks less appealing with 11% planning to buy semi-commercial property and only 7% commercial property.
Two-thirds of those planning to purchase more property say they will need to refinance in order to do so.
43% said they will look to remortgage in the first half of 2013, up from 36% six months ago.
David Whittaker, managing director at Mortgages for Business, said: “Tenant demand for residential property is ballooning thanks to the lack of mortgages available to first-time buyers.
“Every month more and more would-be buyers are being forced to rent, and this is pushing up demand to astronomical levels, producing very attractive gross yields for landlords as a result.
“Not surprising, then, that well over half of investors want to expand their portfolios to take advantage of these high yields.
“The first half of 2013 will see a spate of purchasing and remortgaging as landlords try to put themselves in a position to take full advantage of a buy to let sector which is in very good health.”
76% of investors said that lenders should be doing more to help them get the finance they need.
The biggest issue they pointed to was lending criteria with 45% saying criteria should be eased.
27% suggested a reduction in rates, with some landlords proposing buy to let rates should become similar to residential mortgage rates.
Surprisingly the research showed that many landlords relied on rental income, despite most lenders stipulating additional income of £20,000 to £25,000 being needed to gain finance.
