Yields ease but rental market riding the Coronavirus ...

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11 May 2020

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Yields ease but rental market riding the Coronavirus challenge

New research suggested that yields across the UK rental market are remaining broadly unchanged despite the Coronavirus crisis.

The current average sits at 3.5 per cent, having seen a marginal decline from the 3.6 per cent registered prior to the pandemic hitting.

However, even with the obstacles that the current landscape presents, there are still a number of buy-to-let pockets providing strong returns for landlords who want to invest in property.

Bradford is home to the highest average yield at 10.0 per cent with Gwynedd on 6.2 per cent and North Down on 6.0 per cent.

Glasgow, Liverpool, Preston, West Dunbartonshire, North Lanarkshire, Forest Heath and Manchester also rank high, while at the other end of the scale Kensington and Chelsea, Malvern Hills and Chiltern are home to the UK’s worst average yields at 2.3 per cent.

Howsy, the lettings platform which commissioned the research, says that possible pandemic-induced house price falls while rental demand remains high could mean an increase in yields.

But even before this materialises, there are patches of the UK buy-to-let market that have already seen yields rise this year.

The largest has been in North West Leicestershire, where yields are up 1.4 per cent during the pandemic. Arun, Corby and West Norfolk have also enjoyed an increase of 0.8 per cent.

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- dale james
- 11 May 2020 08:33 AM
Surely yields are based on returns against value? Who can say what the current 'value' of property is and will be? We are hoping that there will be no drop in value but are we kidding ourselves?

- Retired Agent one
- 11 May 2020 20:34 PM
Seems to me that any landlord prepared to buy a rental property that on the face of it shows a yield of around 3.5% is foolish. Yields need to be at least 6% to make it worth while buying. After deductions and voids this will reduce but to start out at 3.5% will probably give a yield around 2% absolute maximum or probably about 1.5%. With HMRC taxing landlords to the hilt.....Oh dear, pretty poor research I'd say.
Where do these idiots who use masaged information to make matters look worse and their research look good come from. Planet Zod comes to mind.
11 May 2020 20:53 PM
Many LL accept such low yields as they gamble on Property CG.
Doesn't always work out!!
Very few would bother being LL if CG was a major objective.
It was the ONLY reason I bought multiple properties with my resources rather than possibly the more sensible one property which wouldn't need leverage to acquire.
Would have far superior yield but only CG possibility on the one property.
In hindsight I wish that is what I had done.
But hey we all make investment errors of judgement!!
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