Buy-to-let returns continue to outperform many major asset classes with property investors in northern areas benefitting from higher yields, owed in part to lower property values, whereas southern regions unsurprisingly have the lowest yields given the higher housing costs, new figures show.
Data from TotallyMoney reveals that buy-to-let returns have remained strong in recent months despite the challenges that have faced the market, with Liverpool, Manchester, Middlesborough, Newcastle and Edinburgh proving to be the top performing regions thanks to high demand for rental properties.
The research, which analysed more than 580,000 properties, once again reveals a clear geographical divide between the north and the south of the country with northern regions coming out on top and the South East in particular showing particularly poorly.
Landlords in London have seen among the lowest rental yields.
Away from the capital, landlords with properties in Bournemouth’s BH14 and Crewe’s CW12 can also typically expect to receive low returns, according to TotallyMoney.
Joe Gardiner, head of brand and content at TotallyMoney, commented: “With students flocking to university cities year after year and looking for a place to live, it’s no surprise the student market is a dependable one for landlords.
“Since so many students are looking for accommodation, landlords may use this as an opportunity to drum up competition between them.
“But, due to the tenant fee ban, changes in mortgage tax relief, and tighter buy-to-let lending criteria, rental profits are now being squeezed more than ever. To maximise their returns landlords need to be savvier and that’s where our map and mortgage comparison tool can help.”
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