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Sancho Panza

Landlords Outside The Capital Are Seeing The Best Rental Yields.

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Telegraph 22.8.13

Buy-to-let properties outside of London offer the highest rental yields to landlords, with some areas returning 10pc or more.

Buy-to-let properties in Birmingham and Kent are producing the highest rental yields for landlords, research shows.

Landords in Nechells, Birmingham and New Romney, Kent are collecting returns of 10.6pc and 10.5pc respectively.

Residential property group Move with Us and property search engine Home.co.uk have published a buy-to-let property heat-map showing the regions across England and Wales that offer the best rental yields.

The research looks at two-bedroom properties for sale and for rent. It shows the highest yields are mainly outside Greater London. This is due to lower up-front costs and more reasonable rental prices outside of the capital, the researchers said.

Top ten yielding postal districts in England and Wales

Postal District

Region

Gross Rental Yield

Nechells

Birmingham

10.6%

New Romney, Greatstone-on-Sea, Littlestone-on-Sea

Kent

10.5%

Broadgreen, Dovecot, Knotty Ash, Page Moss

Merseyside

9.6%

Cranleigh, Ewhurst, Alfold

Surrey

9.5%

Gresham, University, Abingdon

Middlesbrough

9.2%

Castle Vale

Birmingham

9.2%

Anfield, Kirkdale, Walton

Liverpool

9.1%

Betchworth

Surrey

9.1%

Winson Green, Hockley

Birmingham

8.7%

Waltham Cross, Cheshunt, some parts of Enfield

Hertfordshire

8.7%

Overall, the pattern shows that the high yielding hot spots are mainly in more densely populated urban and suburban environments where housing demand is strong.

While rental yields are important, investors must also consider the impact of changing property prices on their investment.

Large areas of Greater London currently return an average yield of less than 4pc. However, the capital consistently registers stronger house price growth than other parts of the country.

The infrastructure investment into the Stratford area appears to have helped landlords, with three of the top five Greater London postcodes clustered within sight of the Olympic area. Each returns a yield of more than 7pc.

Top five yielding postal districts in Greater London

Postal District

Area

Gross Rental Yield

Lower Edmonton

North London

7.8%

Plaistow

East London

7.5%

Abbey Wood

South-East London

7.4%

East Ham

East London

7.2%

Stratford

East London

7.2%'

Castle Vale,Winson Green......

Edited by Sancho Panza

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Looks like benefit hotspots-New Romney is not an employment powerhouse I'd venture.

I don't think many BTL LL are achieving the stated yields.

Indeed,I think that's the prevailing message.If you want yield,you need government tenants.There's no data on arrears,nor is there any forward guidance,for want of a better phrase, on the effect Housing Benefit changes will potentially have on returns.

Edited by Sancho Panza

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Indeed,I think that's the prevailing message.If you want yield,you need government tenants.There's no data on arrears,nor is there any forward guidance,for want of a better phrase, on the effect Housing Benefit changes will potentially have on returns.

....yes, government subsidized tenants........those who could afford the rents have bought or are buying.....unless they want the flexibility of renting short-term, (having a higher t/o of tenants means more costs such as fees, decorating/refurbishing costs and longer periods of voids), their employers are covering for the rents or the rents are value for money meaning a quality low risk long-term tenant will only pay a low yield. ;)

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Nechells, Winson Green and Castle Vale are all areas where the cheapest property can be found in Birmingham so I suppose the yield would be higher

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Exactly.

Yields tend to follow prices back up...whatever the market will bear.

It merely reflects that house prices in 'the capital' have risen of late. There is a lag. But we know there is total correlation between rents and prices.

(Leeds excepted)

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No they don't

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A strange article with a list of percentages. I have no idea what the data was like or how they calculated the yields. For example I've looked up Cranleigh in Surrey on Rightmove and there are only 124 properties for sale.

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I've noticed a few time recently these out of London type ramping articles....best buy now before you are priced out!

where are all the mps demanding an end to housing as an investment!

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