The data shows that over the last five years, investors in Manchester and Liverpool have enjoyed the best rental yields in the UK, followed by Cardiff, Coventry, Oldham, Sunderland, Blackburn and Durham.
However, capital growth and return on investment is dominated by the South East and London. All top 15 performing postcode areas for capital gains are located in London and surrounding regions.
Peter Armistead of Armistead Property comments: “Clearly, the North West is great place for BTL investment. An average residential property in Manchester is just £155,000, while a flat in a good area, costs as little as £120,000. A property in Manchester can provide a 5% minimum cash rental yield and a typical 12% total cash yield, including 7% capital appreciation. Demand for rental accommodation is strong and by comparison with other regions, housing is cheaper.
House prices in London are about five times what they are in Manchester, but salaries are only 30% higher. Manchester is a very affordable place to live and demand for property is soaring in the City, thanks to the expansion of the MetroLink tram system, the trendy Northern Quarter and the BBC Media City. It has vibrant restaurants, bars, clubs plus a great music scene, galleries and museums.
In 2016, we may start to see a shift in investment focus away from London and towards the more lucrative and profitable BTL areas in the UK. Many investors will be looking at ways to protect potential new investments in 2016 from the impact of the stamp duty changes and According to Armistead Property, many landlords will be looking at ways to protect potential new investments in 2016 from the impact of the stamp duty changes and end of the mortgage rate relief the end of mortgage rate relief."
