Where can you achieve the greatest rental yields?

Investors rushed to take out landlord insurance on buy-to-let properties during the opening quarter of the year, ahead of 3% stamp duty surcharge. This underlined the growth of buy-to-let popularity over the last few years, with attractiveness heightened at a period of low interest rates and changing stock markets.

In fact, buy-to-let investment has easily outperformed other asset classes in recent times. Total annual returns for landlords reached 12% in 2015-£21,988 in monetary terms.

With this said, just where are the best and worst locations for gross rental yields in the UK?

Buy-to-let hotspots

The latest TotallyMoney Buy-to-Let Yield Map gives an insight into the current rental market. The report looked at 137,955 rental properties and 303,822 properties marketed for sale online on the 1st October 2016.

Data shows that there is a clear geographical difference between the North and South of the UK in terms of yields. Northern regions lead the way, while Southern areas are lagging behind, due to the higher price of property in these locations.

In fact, nine of the ten top yielding postcode regions were found to be in Scotland and the North/Midlands regions.

On the other end of the scale, eight of the ten lowest yielding postcode regions were in Greater London, the South East or on the South Coast.

Where can you achieve the greatest rental yields?

Where can you achieve the greatest rental yields?

The top ten postcode regions and average rents were revealed to be: (yield indicated in far right column)

Postcode Postcode Post Town Coverage AverageRent Average House Price
1 LS6 Leeds Beckett Park, Burley, Headingley, Hyde Park, Meanwood, Woodhouse £1,044 £116,115 10.79%
2 BD1 Bradford Bradford City Centre, Little Germany, Goitside, Longlands £552 £64,108 10.33%
3 YO1 York City Centre £1,876 £231,388 9.73%
4 PR1 Preston City Centre, Avenham, Broadgate, Deepdale £952 £125,810 9.08%
5 TS1 Middlesbrough Town Centre £523 £69,368 9.05%
6 L7 Liverpool City Centre, Edge Hill, Fairfield, Kensington £720 £99,114 8.72%
7 M3 Manchester City Centre, Deansgate, Castlefield £1,230 £177,546 8.31%
8 S1 Sheffield Sheffield City Centre £823 £118,861 8.31%
9 HD1 Huddersfield Huddersfield Town Centre, Hillhouse, Lockwood, Marsh £656 £101,536 7.75%
10 CF24 Cardiff Cardiff South, Rumney & Trowbridge £1,220 £192,548 7.60%

 

The worst locations for rental yields were found to be: (yield indicated in far right column)

Postcode Post Town Coverage Average Rent Average House Price Yield
867 BR2 Bromley Hayes, Shortlands, Bickley, Bromley Common, Keston £1,300 £788,293 1.98%
868 N21 London Winchmore Hill, Bush Hill, Grange Park £1,339 £825,700 1.95%
869 HA6 Northwood Northwood, Northwood Hills, Moor Park £1,732 £1,103,645 1.88%
870 B15 Birmingham Edgbaston, Lee Bank £1,013 £656,412 1.85%
871 W8 London Kensington, Holland Park £4,920 £3,320,116 1.78%
872 RG8 Reading Goring, Streatley, Pangbourne, Whitchurch-on-Thames £1,225 £865,454 1.70%
873 N2 London East Finchley, Fortis Green, Hampstead Garden Suburb £3,764 £2,733,640 1.65%
874 BH14 Poole Lower Parkstone, Lilliput, Penn Hill £1,288 £1,000,795 1.54%
875 N6 London Highgate, Hampstead Heath £2,779 £2,418,305 1.38%

[1] https://www.landlordtoday.co.uk/breaking-news/2016/10/britains-highest-rental-yields-the-top-10-postcodes-for-buy-to-let

 

 

 

 

©2017 Just Landlords

Log in with your credentials

Forgot your details?