Paragon Mortgages has found that landlords are looking towards next year with an increasing sense of optimism for the wider buy-to-let market and the performance of their rental portfolios.

The buy-to-let lender’s Q4 PRS Trends survey of around 200 landlord customers found that 38% of landlords are feeling optimistic about the prospects for their portfolio.

During the second half of 2013 landlords’ optimism has been at the highest level recorded. Those surveyed were also feeling positive about the value of their property investments with 33% expecting an increase in net value in 2014.

This has also been an upward trend, having dipped to an all-time low between 2008/2009 and remaining relatively flat through 2010 – 2012.

Just over a fifth of landlords are planning to invest in further buy-to-let property in the first quarter of 2014. Of those landlords looking to buy, large-scale landlords were more likely to expect to purchase property (25%) than small-scale landlords (8%).

John Heron (pictured), director of mortgages at Paragon, said: “2013 has been a good year for buy-to-let and landlords certainly seem to be more active in the market. We have seen a steady increase in the levels of optimism among our landlord customers, and this looks set to stay in the New Year.

“We expect buy-to-let lending market wide in 2013 to be in the region of £20 billion and whilst this would represent a material level of growth over 2012 we should keep things in perspective. This only takes us back to the level of buy-to-let lending that we had 10 years ago and over that period the private rented sector has increased by 80%. Any talk of boom conditions in the buy-to-let market would appear to be premature indeed.”