Liverpool has been confirmed as the UK’s top buy to let hotspot with a rental yield for landlords of 8% when associated costs are taken into account.
As housing and mortgage costs have the biggest influence on yields in the current market, the city takes the top spot as it has a combination of low average house prices at £122,283 and strong rents at £1,021 per month.
Nottingham comes second with a rental yield of 5.6%, followed by Coventry at 5.4%, then Greater Manchester at 4.3% and Portsmouth at 4.2%, according to the analysis from Private Finance.
Even with the recent tax changes, including higher rates of stamp duty and the reduction in mortgage interest tax relief, the research shows it is vitally important investors to maximise returns to cover for ever increasing costs.
Cardiff, Blackpool, Lincoln are next with rental yields of 3.9% each, then Bournemouth and Southampton make up the rest of the top 10 with rental yields of 3.8% and 3.7% respectively.
The research, which looked at the rental yields in the 50 UK towns and cities with the highest proportion of private rental housing stock, six of the top ten areas with the lowest house prices are also in the top 10 list for best rental yields. However, none of the locations with the top ten highest average rents are buy to let hotspots. With the majority of these being in London with the associated high average values of property, the yields you can achieve are very low.
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