One in 10 landlords plan to purchase investment property, but are hampered by a lack of mortgage finance. Paragon Mortgages’ Trends research reveals that 10 per cent of landlords planned to expand their portfolio in the first three months of 2010.

Nearly two thirds of those surveyed said that they would purchase a terraced property, followed by semi-detached houses (25 per cent), flats (20 per cent) and detached property (10 per cent). However, mortgage finance looks likely to remain a serious issue in 2010.

John Heron, Paragon Mortgages’ MD, says, ‘It is encouraging that landlords are still active in the market and are looking to expand their portfolios. With tenant demand at such strong levels and soft house prices presenting bargains, it is easy to see why. But investors continue to be frustrated by a lack of choice in the buy-to-let mortgage market, which is dominated by just two lenders. Landlords have told us that it was more difficult to source mortgage finance in the fourth quarter and we see nothing to suggest that the situation will improve quickly.’