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High potential rental yields for buy-to-let student property

Mortgage Solutions
Written By:
Posted:
07/08/2007
Updated:
07/08/2007

Buy to let student property can yield rental returns of more than 9%, according to a survey by buy-to-let mortgage specialists Landlord Mortgages.

Durham was revealed as the most lucrative university town in which to buy student property, with yields of 9.12%, followed by Nottingham, with yields of 9.05%.

Landlord Mortgages managing director Lee Grandin said: “Low purchase prices compared to the relative achievable rent make student buy-to-let properties in certain towns a worthwhile investment.”

However, not all student towns offer such high potential returns.

Crewe emerged as the least profitable location in which to rent to students, with a yield of only 3.4%, followed by Cheltenham, Guildford and Pontypridd, all with rental yields of less than 4.5%.

“Any investor has to do their figures, but there is the opportunity to make good money,” added Grandin.

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Northern towns generally emerged as the most profitable, as low purchase prices increased relative returns, with southern towns the least lucrative, due to relatively high average house prices.

Other factors are important in determining potential yields, with the availability of university-provided accommodation the chief threat to owners of student buy-to-let properties.


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