LETTING & ESTATE AGENT

Where is the most profitable area in the UK for buy-to-let landlords?

Where is the most profitable area in the UK for buy-to-let landlords?

Property investors looking to invest in the buy-to-let market may wish to consider buying property in Luton, which currently offers the best return on investment, new research shows.

According to Lendinvest's latest buy-to-let index, Luton in Bedfordshire is currently the most profitable area in the UK for buy-to-let landlords, with rental prices increasing by almost 10%, the largest increase in the country. 

On an annual basis landlords in Luton generated a 4.81% yield, while home prices rose by 13.63% and experienced rental price growth of 9.58%.

Other areas to perform well included Stevenage, Enfield, Northampton, Dartford, Southend-on-Sea, Romford, Chelmsford, Southall and Twickenham.

Christian Faes, co-founder and chief executive at LendInvest, commented: "There are a host of different factors that investors have to take into account before buying a property. The big one is of course capital values - you want to buy a property that is going to increase in value during your ownership.

"The prospects for further house price growth is good - we still aren't building anywhere near enough homes in the UK - but there are regional differences to take into account. As the LendInvest Buy-to-Let index highlights, the capital value growth seen in postcodes in the South East are significantly higher than those elsewhere in England and Wales.

"However, it's certainly not the only thing to look out for. Investors also need to measure up the prospects for rental price growth, how active the local market is, and the overall rental yield. Areas that perform well in all of these metrics are winners for property investors."

The top 10 buy-to-let postcodes

 

Yield

Capital gains

Rental price growth

Transaction volume growth

Luton

4.81%

13.63%

9.58%

-4.71%

Stevenage

4.31%

14.78%

8.95%

-9.81%

Enfield

4.76%

17.36%

2.21%

-4.35%

Northampton

4.87%

8.11%

8.33%

4.38%

Dartford

4.78%

13.02%

7.98%

-10.22%

Southend-on-Sea

4.56%

11.79%

5.95%

-4.63%

Romford

5.26%

13.47%

2.48%

-1.55%

Chelmsford

4.26%

12.15%

5.29%

-3.96%

Southall

4.88%

14.01%

3.97%

-10.36%

Twickenham

4.48%

15.49%

2.34%

-9.16%

 


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