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Landlords should look north for strongest buy-to-let profits
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
Scotland and the North West have been highlighted as the most profitable areas for property investment in 2019/2020, according to TotallyMoney.
The results of the credit expert’s latest research reveal:
- The UK buy-to-let market is currently doing well. Many of the best performing postcodes in the UK turn a 7% to 8% yield
- The highest returns in the UK can be found in Liverpool’s L1 postcode (10% yield)
- Two Scotland postcodes have made the top three and a total of nine Scottish areas feature in the top 25 of the best yields
- All postcodes in the top 25 have property asking prices under the current UK national average of £232,710
- St Albans’ AL5 postcode has the lowest yield in the UK, a poor 1.95%. This is closely followed by Ipswich’s IP13 at 1.96%
Despite the ongoing changes in landlord tax relief and an increase in landlord responsibilities, TotallyMoney’s research shows plenty of UK postcodes return healthy profits for property investors.
Top 25 UK buy-to-let postcodes
- Liverpool’s L1 boasts a strong 10% profit margin, smashing the 3% yield many of the UK’s postcodes offer. Properties can be bought for an average pf £90,000 and can bring in a median rental value of £750
- The North is also doing well, particularly in Falkirk and Glasgow. FK3 and G52 are seeing yields of 9.51% and 8.75% respectively
- The 16 top postcodes are in the North West (predominantly Liverpool) and Scotland
| Rank | Postcode | Postcode Town | Properties for Rent | Median Rental Value | Properties for Sale | Median Asking Price | Yield |
| 1 | L1 | Liverpool | 187 | £750 | 368 | £90,000 | 10.00% |
| 2 | FK3 | Falkirk | 30 | £495 | 39 | £62,450 | 9.51% |
| 3 | G52 | Glasgow | 46 | £595 | 66 | £82,000 | 8.71% |
| 4 | L11 | Liverpool | 55 | £650 | 31 | £90,000 | 8.67% |
| 5 | TS1 | Cleveland | 65 | £425 | 34 | £60,000 | 8.50% |
| 6 | KA1 | Kilmarnock | 68 | £450 | 75 | £64,995 | 8.31% |
| 7 | L6 | Liverpool | 153 | £575 | 59 | £85,000 | 8.12% |
| 8 | LE1 | Leicester | 176 | £667 | 116 | £100,000 | 8.00% |
| 9 | LS2 | Leeds | 111 | £825 | 32 | £125,000 | 7.92% |
| 10 | S1 | Sheffield | 219 | £750 | 68 | £115,000 | 7.83% |
| 11 | CF43 | Cardiff | 36 | £425 | 35 | £67,000 | 7.61% |
| 12 | TS3 | Cleveland | 60 | £475 | 63 | £74,975 | 7.60% |
| 13 | L2 | Liverpool | 115 | £850 | 106 | £135,000 | 7.56% |
| 14 | PA3 | Paisley | 42 | £425 | 43 | £68,500 | 7.45% |
| 15 | L3 | Liverpool | 282 | £740 | 360 | £119,950 | 7.40% |
| 16 | SR8 | Sunderland | 85 | £450 | 143 | £73,725 | 7.32% |
| 17 | G51 | Glasgow | 74 | £595 | 31 | £97,500 | 7.32% |
| 18 | NE8 | Gateshead | 148 | £575 | 75 | £94,950 | 7.27% |
| 19 | AB11 | Aberdeen | 173 | £600 | 45 | £99,995 | 7.20% |
| 20 | G67 | Glasgow | 57 | £450 | 65 | £75,000 | 7.20% |
| 21 | G32 | Glasgow | 46 | £475 | 76 | £79,995 | 7.13% |
| 22 | L4 | Liverpool | 136 | £475 | 94 | £80,000 | 7.13% |
| 23 | G21 | Glasgow | 30 | £550 | 31 | £92,995 | 7.10% |
| 24 | LA14 | Lancaster | 50 | £500 | 128 | £85,000 | 7.06% |
| 25 | SR5 | Sunderland | 46 | £495 | 40 | £84,950 | 6.99% |
Weak performing postcodes for investment property
- AL5 in St Albans is at the very bottom for yields, at 1.95%. The average buying price for a property is £800,000, and asking rent is £1,300 per month
- London’s W8 postcode (Kensington), provides a 2.05% return for landlords, even though average property prices are a hefty £1,962,500.
- Other commuter spots in the bottom 10 include RG10 in Reading (2.26%), GU10 in Guilford (2.22%) and KT7 in Kingston upon Thames (2.20%).
TotallyMoney spokesperson James McCaffrey, comments on the findings: “Many existing and would-be landlords wonder if buy-to-let is still worth it. Our findings are another source to help property investors answer that question.
“The maps and data clearly show there are pockets of profit for landlord investment this year. And it seems that Scotland and the North are good places to start a buy-to-let property search.
“Landlords should always do their research before committing to a property purchase. Understanding current market trends is part of that. Making sure they’re financially prepared is another.
