Sheffield’s private rental sector is booming, particularly in the student market.
Rick Flay, the director of Belvoir letting agents on Campo Lane, Sheffield, explains which property types are succeeding: “Sheffield is certainly a buyers market and I am personally looking for terraced houses close to good transport links. Homes that make use of three bedrooms, a lounge, kitchen and dining room that can be bought below value.
“Buy-to-let in areas including Hillsborough, Chapletown and Crookes are particularly good investments at present.
“I am also looking for HMO properties in areas such as Hunters Bar, Crookes and Broomhill, which can be used as student houses, and I am advising other landlords to do the same.”
Flay calls Sheffield a “large, vibrant university town” with a “booming” rental market. He adds that rental yields are “at an all time high”.
He continues: “We are finding that yields on one-bedroom flats are good at about say 7% if you buy at right price, two-bedroom flats are good at 8.5% and three-bedroom terraces are good at about 7%.”
And four-bedroom houses are bringing in strong yields in the student sector.
Landlords can also bag a good deal in Sheffield, as house prices are relatively low. The average asking price of a three-bed house in S6 is £100,000, with rental yields of around £575 per month. In Chapletown, a three-bed house costs about £95,000 with rental returns of £550.
To avoid void periods, investors should buy close to the University of Sheffield and Sheffield Hallam University, or look for properties close to the city centre. However, house prices demand much higher premiums in these parts.
Asking prices in Hunters Bar and Broomhill can rise to £250,000.
Flay looks at the market: “One of the significant property trends is for young couples renting out property in the area and looking to stay on a longer term basis.
“This again is fantastic for the residential landlord, as it reduces void periods and helps you to establish a long-term relationship with the tenant.”1
He explains that one landlord recently bought a mid-terraced house in S10 for £160,000. When redecorated, it will accommodate four students and make a 9-10% gross yield.