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Revealed: The best and worst postcodes for buy-to-let returns

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21/06/2018
Student cities can provide high yields for buy-to-let landlords
Revealed: The best and worst postcodes for buy-to-let returns

University cities offer the highest return on buy-to-let investments, with Liverpool coming out on top, according to research by TotallyMoney.

The price comparison site put Liverpool postcodes L7 and L6 in first and second place, with average rental yields of 11.79% and 11.59% respectively.

The postcodes are close to two of Liverpool’s three universities, making it a potential hotspot for buy-to-let investors looking to let to students.

Middlesbrough’s TS1 town centre postcode, home to Teeside University, came third, with an average rental yield of 10.94%. The area also has an average asking house price of just over £65,000, making it one of the most affordable buy-to-let hotspots.

Edinburgh postcode EH8 came fourth, with average yields of 10.62%. It’s home to the University of Edinburgh, which is the sixth best in the UK, according to the Times Higher Education World University Rankings.

With a student population of 100,000, M14 in Manchester also performed well, with average rental yields of 10.08%.

London low

At the other end of the scale, London was one of the worst areas across Britain for buy-to-let yields, with north London faring particularly badly.

Five north London postcodes rank in the bottom 10, with rental yields as low as 1.5%.

Outside of London, the worst performing area was Bournemouth’s BH14, which has average rental yields of 1.68%.

Crewe’s CW12 was also a poor performer, with average yields of 1.74%.

TotallyMoney’s head of brand and content, Joe Gardiner, said: “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.”

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