The best cities in the UK for buy to let investment have been revealed
after 50 locations were analysed by financial experts.
The findings from Aldermore reveal there are still lots of
solid BTL investment opportunities available despite the ongoing Covid-19
pandemic.
The bank looked at five key indicators to determine a city’s desirability
to BTL investors – including the average rent and returns a landlord can
enjoy.
In first place is Manchester which, despite having stricter lockdown
measures than many other parts of the UK, has enjoyed rapid economic
growth.
Aldermore says Manchester performs well on its core factors including
long-term house price growth and rental returns.
Manchester is one of the UK’s largest rental markets
It helps that Manchester is one of the UK’s largest rental markets with a
big student population and young professionals.
In second place is Cambridge, and London is in third place.
Oxford came fourth as the best BTL location for investing in, followed by
Brighton.
Aldermore’s head of mortgage distribution, John Cooper, said: “Since the
Covid-19 outbreak, there has been uncertainty for landlords who have had to
adapt to challenges and with many tenants working from home, it reinforces
the importance of a diverse and robust private rented sector.
“The changing needs of tenants has created investment opportunities for
landlords, whether renters want a different type of property to fit with
their working demands, or if they want to move to a new location.”
The managing director of Accommodation for Students, Simon
Thompson, said: “The research from Aldermore is interesting because it
highlights that the fundamentals of the UK’s rental sector are still
strong, despite the pandemic, and there are still opportunities for
landlords wanting to invest in buy to let property.”
Their research also reveals that Wales is ‘struggling across the board’ as
a BTL investment destination, and in Yorkshire, several cities are
producing some of the country’s highest yields.
Survey reveals what tenants want
Meanwhile, a survey of 2,000 tenants in London has uncovered what they want
from their rented home.
According to letting agents Kinleigh Folkard & Hayward
, the most important issue, for 66% of tenants, is affordability.
However, 71% of renters say they are happy with their rental property,
while 82% say they have security over their rental home’s tenure.
Along with affordability, the survey highlights that London tenants are
changing their preferences and with more people spending more time at home,
58% said having access to a private outdoor space is important.
Also, for 48% of tenants, having a fast broadband connection is important,
while 44% of tenants said they wanted a dedicated space for working in
their home.
Landlords with properties in London may be surprised to hear that 44%
tenants living in Zones 1 and 2 say they may consider moving to Zone 3 –
while those in Zone 3 say they are thinking of moving to Zone 6 and beyond.
