Landlord confidence across a range of measures remained stable or increased in the first quarter of 2018 compared with the end of last year, according to Paragon.

The recent survey of 1,043 landlords revealed that landlords in the East of England were most positive about the future, with 53% saying that they felt upbeat about the prospects for their own lettings business over the next three months.

This follows the sharp dip in confidence following the new tax measures for landlords in 2015 and a further fall after the introduction of stricter underwriting rules for buy-to-let mortgages last year.

The East of England also saw strong tenant demand, with 81% of landlords indicating that demand for rental accommodation in the area they let property in was either increasing or stable.

The East (81%) and West Midlands (76%) also recorded similar levels of tenant demand, with both areas also ranking among the top five regions in England and Wales for rental yield and capital gains.

Meanwhile, only 26% of landlords in Central London rated prospects for their own letting business as good or very good over the next three months. Fewer landlords (57%) in the area reported tenant demand as stable or increasing than in any other region, while 27% of landlords were most likely to have reduced rent in the last year.

John Heron, managing director of mortgages at Paragon, said: “After an unprecedented level of change, it’s encouraging to see landlord confidence stabilising this quarter.”

“At a regional level, the East of England and the Midlands look well-supported, with encouraging data on tenant demand, yield and capital gains, while the London market adjusts its footing after many years of strong growth.”