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Rental yield property hotspots for landlords

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12/02/2020
Property remains a consistent-performing investment, but where is the best place to buy?
Rental yield property hotspots for landlords

The average rental yield across the UK is 4%, according to research by Sourced Capital.

The peer-to-peer lending platform said that the UK property market remains one of the most consistent investment options available in today’s markets, with a wealth of property pockets offering yields above the national average.

North of the border

The nation currently offering the best top-line yields is Scotland at 5.8%, closely followed by Northern Ireland at 5.4%, with England also coming in just above the UK average (4.1%).

Wales however, recorded yields of just 3.6%.

Scotland’s yields are particularly high on a local level too, with 14 of the top 20 yielding areas located north of the border.

Glasgow ranks top with yields of 7.8% on average, followed by West Dunbartonshire (7.2%) and Inverclyde (7.1%).

Regional split

Regionally, the North East (4.9%), Yorkshire and the Humber (4.5%) and the North West (4.4%) are home to the best rental yields, as the list below shows:

North East: 4.9%
Yorkshire and the Humber: 4.5%
North West: 4.4%
London: 4.3%
West Midlands: 4.2%
East Midlands: 3.8%
South West: 3.8%
South East: 3.7%
East of England: 3.6%
UK: 4%

Buy-to-let local hotspots

Burnley ranks at number six in the UK on a local level and the best in England with the average rental yield currently at 6.6%, followed by Belfast (6.4%).

Other areas outside of Scotland to make the top 20 include Blackpool (5.9%), Country Durham (5.8%), Pende (5.8%) and Hyndburn (5.8%).

In London, Tower Hamlets is currently home to the highest yields at 4.7%, followed by neighbouring Newham (4.6%) and Barking and Dagenham (4.6%).

Founder and managing director of Sourced Capital, Stephen Moss, said: “One positive that can be taken from months of stagnant house price growth brought on by Brexit uncertainty is that rental yields have seen a boost due to a fall in property values coupled with consistently high rental demand and rental prices as a result.

“We’ve already seen a Boris inspired bounce late last year with early signs that the market has ‘bottomed out’ and is once again on the up already in 2020. As a result, we’ve also seen an early flurry of investor activity as they realise now is a great time to get a foot in the door and secure a good deal before prices do regain momentum and the returns available start to tighten.”

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