A survey of landlords has found almost 60% expect to see a rise in demand for rental properties in the next 12 months.
While 41 per cent of the 2,195 respondents reported a rise in tenant demand in the last six months of 2013, 58 per cent said they believe this will continue to rise this year.
Less than 10 per cent of those surveyed predicted a slight decline in demand.
With the rise in demand from tenants fuelling a rise in property prices, more than three-quarters landlords say now is a good time to buy or sell rental properties, with 18 per cent of respondents expected to grow their portfolio in the next 12 months.
However despite the predicted upturn in fortunes, a third of those polled say it is harder to raise mortgage finance now than a year ago.
Just one in six say cheap finance is a key reason for why it is a good time to invest, though this is up from one in 11 in December 2012.
Commenting on the figures property expert David Newnes said: “Landlords are in a prime position to benefit from the strong yields on properties and aspiring buy-to-let investors can be encouraged by the climbing tenant demand, as not only does it signify the excellent long-term investment opportunity, but also demonstrates the continued appetite for rental homes.
“Against the backdrop of growing economic stability, more confidence is driving people forward in search of the attractive deals on offer across the buy-to-let mortgage market, which will allow them to benefit from the attractive returns.”