BTL deposits up and yields down

The average deposit put down in the second half of last year by BTL investors across the UK was £49,146 - but the figure masks big regional variations.

In London the typical BTL investor put down an average £119,750 which is over four times the average deposit in the north of England, £27,710.

Research by BM Solutions, part of the Lloyds Banking Group, shows that BTL purchases have been buoyant with transactions growing 28 per cent from 36,400 in the second half of 2012 to 46,430 in the second half of 2013. But transaction totals remain well off their peak figure - 96,640 back in the second half of 2006.

Meanwhile average gross rental yields dipped very slightly to 5.5 per cent in the second half of 2013 from 5.6% in the same period of the previous year.

Investors in the north of the country recorded the highest yields in the second half of 2013. In the north, Yorkshire and Humberside yields hit 6.6 per cent; the north west recorded 6.3 per cent and Wales and Scotland both saw 6.2 per cent.

The lowest rental yields were in London with 4.8 per cent followed by the south west on 5.1 per cent and the south east at 5.2 per cent.