Buy-to-let continues to offer an attractive investment opportunity, despite tough regulatory changes introduced last year, according to a leading property auctioneer,

However, a 3% stamp duty surcharge for additional properties, the reduction in mortgage interest tax relief, and more stringent lending conditions have made buy-to-let a less appealing option.

“Government policy has offered investors little comfort,” says Gary Murphy, a partner and auctioneer at Allsop.

He believes that political and economic uncertainty, alongside the tightening of mortgage lending criteria, are forcing many landlords to review their portfolios.

Despite this, Mr Murphy insists there is “still appetite in the market” for new buy-to-let property acquisitions.

This has been helped by welcome news of the Government’s decision to moderate the amount it expects landlords to pay for energy efficiency improvements on their properties, in order to bring them up to an Energy Performance Certificate (EPC) rating of at least E.

This requirement comes into force as part of the Government’s new Minimum Energy Efficiency Standards (MEES) for new lets and tenancy renewals from April 2018, and for all residential lets from April 2020.

Original Government proposals would have required to pay up to £5,000 per property. Now, following recommendations of the Residential Landlords Association (RLA), the limit has been cut to £2,500.

This could help to avoid a 'green tax' on tenants, as landlords passed costs on in the form of higher rents.

Mr Murphy advises buy-to-let landlords to focus on growth areas and says: “London’s suburbs can still offer investor value. But regional cities are the smart buy in 2018 for capital growth and strong returns.”