Paragon Mortgages’ latest Private Rented Sector (PRS) Trends report, based on interviews with a panel of more than 200 experienced landlords, shows a modest improvement in optimism among landlords as they begin to take action ahead of changes to tax relief.

Despite turbulence following announcements from the Government in 2015 that tax relief on BTL mortgage interest would be reduced and stamp duty increased, 22% of landlords surveyed are now more optimistic as they come to terms with the impending changes. While the majority (65%) of landlords report no change in sentiment, 12% still said that, compared with three months ago, they are now more pessimistic, down from 18% three months ago.

This coincides with rising levels of awareness about the implications of the tax relief changes, with the policy due to be phased in from April 2017, as 58% of landlords reported having already taken, or are making plans to take, action ahead of time.

The most commonly reported actions have been to increase the rent charged to cover some or all of the increased cost (24%), to maintain their current properties but not buy any more (21%) and to sell some of their properties and not buy any more (16%).