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Landlords: Look to university towns for the best yields

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17/07/2019
The highest yielding areas for property investment are very often in student areas
Landlords: Look to university towns for the best yields

Nearly all of the UK’s top 20 postcodes for buy-to-let rental yields are located within close proximity to a university campus, according to Howsy.

The lettings platform ranked UK each postcode based on the highest yield available to buy-to-let landlords and found that 17 out of the top 20 are within easy reach of a university campus.

Top buy-to-let hotspots

Bradford’s BD1, covering the city centre – is the best university investment option in the UK. It has an average house price of just £54,938 and an average monthly rent of £468, meaning that buy-to-let landlords can achieve yields of 10.2%.

Sunderland’s SR1 is the the second best university postcode for property investment with yields of 9.4%, followed by Liverpool’s L7 close to both the University of Liverpool and the Royal Liverpool University Hospital with yields of 9.3%.

Landlords with properties in the TS1 postcode close to Middlesbrough train station and Teeside University can generate yields of 9.2%.

Other towns with some of the highest yields for buy-to-let postcodes are Grimsby (DN31), Edinburgh (EH8), Pontypridd (CF37), Glasgow (PA3, G21, G52 & G14), Manchester (M14), Newcastle (NE6), Leeds (LS6) and Nottingham (NG1).

Founder and CEO of Howsy, Calum Brannan, said: “It’s no coincidence that the vast majority of postcodes with the highest rental yields are found within a stone’s throw of a university campus, and for a safe bet on your investment, these are the places to look when buying.

“While students aren’t always the ideal tenants, they bring consistent demand via an annual flow of new arrivals, the void periods are generally much shorter, and the supply-demand imbalance puts the landlord in control when choosing a tenant.

“As a result, these hot pockets of buy-to-let demand offer landlords an investment option that is almost certain to provide a healthy return despite slower market conditions and uncertain times in the buy-to-let market.”

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