Landlords are preparing for a spending surge on the country’s housing market, with terraced properties top of their wish lists, new research has revealed.

According to buy-to-let lender Paragon Mortgages, 21% of landlords are hoping to buy property in the third quarter of 2010, up from 11% at the start of the year.

With tenant demand stronger than ever thanks to the recession’s impact on home finance and mortgage availability, significant numbers of landlords are taking advantage of the socio-economic changes and attracting more students, houses of multiple occupation (HMOs) and one person households.

Of those planning to purchase, 74% desire terraced housing with others looking at semi detached, flats or detached properties.

“There has been a significant jump in the percentage of landlords looking to purchase property, which reflects the increased level of confidence across the landlord community,” commented John Heron, Paragon Mortgages’ Managing Director.

"However, there remains a dislocation between landlords' desire to purchase property and their ability to do so. Accessing mortgage finance remains difficult for a large number of landlords.”

Research found that 40% of landlords attempted to secure buy-to-let finance for purchase or remortgage purposes during the second quarter. Of those that did, 52% said that it was more difficult than previous attempts, with just 13% stating that it was easier.

“If the market, and the private rented sector, is going to expand, then criteria needs to be adapted to allow larger-scale landlords to grow their property businesses," added Mr Heron.