March 2021 saw house price growth of 9.9% year-on-year, as the stamp duty holiday boosted confidence and demand.
Buy-to-let properties have also seen price increases, with the value of the average across the UK rising by 5.6% to December 2020, to approximately £258,900.
In total, 42% of landlords reported that they have seen demand increase for their properties in the past 12 months.
Two-thirds (67%) of landlords said that they were confident about the future of the property market over the next 12 months, with 34% planning to buy a property in the coming year.
Half (49%) of renters say they expect to be renting for the rest of their life.
In total, 10% said they prefer the reduced responsibility of renting, while a further 7% said that renting allowed them to live in a better location than if they bought.
When asked why they were confident about the future of the property market, landlords pointed to house price growth (41%), an increase in demand from tenants (41%), the general strength of the economy (33%), and the increased rental yields currently available (26%).
The highest rental yields were found in the North West (5.5%), Yorkshire and the Humber (5.4%) and Scotland (5.8%).
In comparison, yields for London buy-to-let properties were found to be among the lowest, at 3.9%, below the UK average of 4.3%.
John Eastgate, managing director of property finance at Shawbrook Bank, said: “Against the backdrop of the pandemic, the PRS has once again shown its strength and the important role it plays.
“Landlords are looking to expand their portfolios due to a combination of rising house prices, attractive yields and growing demand from tenants.
“Borrowing to help fund this expansion is an attractive option, with landlords presented with great choice and historically low mortgage costs.
“While more first-time buyers have stepped onto the property ladder in the last year, the reality is that rising house prices mean more will continue to be locked out of home-ownership.
“This, coupled with disruption to employment and lagging wage inflation, will make it difficult for some to buy their own home.
“In addition, with more choosing to rent for the flexibility and freedom it offers, there is a clear need for professional landlords who can offer high quality accommodation.”
