Seaside town tops list of best places for buy to let yields
Added 02.03.10
Blackpool is the place to be for buy to let landlords as the seaside destination topped a list of 100 towns that provide the best yields.
A survey carried out by FindaProperty.com for This is Money, concluded that buy to let investors looking for the best returns should look beyond the normal hotspots as the less fashionable areas often deliver far better returns.
FindaProperty found that property investors in the Lancashire town famous for its tower are currently paying £161,722 for an average home and can charge a monthly rent of around £720. This delivers a gross yield of 5.34 percent.
The follow up story by This is Money based on the survey’s findings noted that while fashionable locations such as Kingston, east London, Manchester, Central London and Twickenham, all made it into the top 20 of the ‘best yields’ list it was the more run of the mill locations such as Blackpool that stood out.
These locations included Kirkcaldy, Romford, Sunderland, Wigan, Blackburn, Bolton, Luton and Cleveland, all of which offer yields above 4 percent.
Properties in these areas can generally be picked up for a lower than average cost.
The survey found that all the Top 100 are currently delivering far greater yields than the return on the average savings account of around 1.5 percent, although none were able to match the 6 percent return of the original buy to let boom.
Plus This is Money pointed out that once mortgage costs, letting fees, maintenance costs and tax are factored in, returns on the buy to let investments would be lower.
In an interview with This is Money, Nigel Lewis, of FindaProperty.com, said: “This shows that the best places for high gross yield are those with lower housing costs, a changing population and in particular if they have one or more universities.
“London is strong because it’s under population pressure and has multiple universities and therefore even satellite areas such as Twickenham do well.
“The other places where gross yields tend to be high are where there is a large inbound ethnic population getting on its economic feet and rental demand is high but house prices usually lower than the average.”
News feed courtesy of Residential Landlord