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Jan 15

Top 10 buy-to-let hot spots by rental yield

Southampton offers the highest percentage rental yield (8.73 pc) within the UK according to new research conducted by HSBC.

This yield is produced by calculating a year’s rental income as a percentage of how much the property cost.

In contrast to the infographic we produced in September which showed Scotland and Northern areas of England as the Top UK Postcodes in terms of highest buy-to-let, the latest figures show that England now has stronger rental yields.

Once again, London has not appeared within the Top 10 which may be due to the high property valuations in comparison to other regions. However, London is still in high demand of rental properties and foreign investment due to its capital appreciation and stable prices.

The strength of Northern areas in England such as Manchester (7.98 pc), Blackpool (7.63 pc) and Hull (7.47 pc) is largely due to their comparatively low house prices shared with strong demand for rental properties from students and young professionals.

It is expected that house price growth will ease in 2015. This should make rental income extremely important during this time and it is anticipated that yields will increase slightly as a result.

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