The British buy to let market is providing savvy investors with some incredible returns. London is famous for its extremely high property prices and monthly rents. However, there are other, less well known, cities in the UK that can offer staggeringly low entry costs, with huge yields. Investing in British buy to let property is relatively straightforward, with very few international restrictions.
British property is one of the most stable assets, which has weathered many storms over recent years. The credit crunch and financial crash hit the market hard, but a decade later, circumstances in the UK are now ideal for buy to let property investment. There is a growing demand for rental property, there are less people buying homes and more people renting for longer. Rents are on the rise across the UK and property investors are seeing increasing income as well as increases in the value of their property investment. Concerns about Brexit are keeping property prices affordable and generally the property market seems to be healthy despite the upcoming changes.
Rental yields are one of the main factors in property investment and it’s essential you find a property where rental yields are high. In cities in the south east, where house prices are incredibly high, it is hard to get high rental yields. However, in other areas of the UK, low property prices and rising rents have added up to make some incredible rental yield figures. The Liverpool postcode of L7 was recently found to be top in the UK for rental yields, with an average of 11.79%. The nearby postcode L6 had an average of 11.59%. Another profitable area you may not be familiar with is Middlesbrough, its TS1 postcode has an average yield of 10.94%. The Northern cities of Manchester and Newcastle upon Tyne were also great for rental yields according to the report. For below market value properties with guaranteed rental returns, RW Invest are one of the UK’s leading property investment firms. They work with developers, architects and construction companies throughout the whole build process to ensure that investors get the best possible returns. Having witnessed the huge profits available in the North of England, their properties in cities like Liverpool and Manchester are perfect for buy to let investment.
With such high rental yields available, investors can start making money from properties in the UK straight away and building up their portfolio in these profitable areas. There is a historic lack of housing in the UK and new build properties are an affordable way the country is trying to tackle this. If investors are willing to play a long game, recent research has shown that they could earn an amazing £162,000 over 25 years for each property they own. The report showed that landlords make an average of £6,500 profit a year, which adds up to a huge £162,000 over a period of 25 years. If investors are willing to wait, while receiving rental income and allowing their property to appreciate, they could make considerable steady profits. If a typical investor took out an average deposit of £73,908, they should receive an impressive total rental income of £369,495 over 25 years. Therefore, with capital gains of £269,464 and total costs of £373,309, the profit would be £265,650 – the equivalent of £161,922 in today’s money. These figures were calculated including remortgaging, running costs and taxes as well as buying and selling costs, showing just how profitable property investment in the UK can be.