Best rental yields outside London
Landlords can get the best rental yields outside London and the South East and profit from cheaper stamp duty to boot.
LendInvest worked out that for £250,000 investors can typically buy a single studio flat in South East London or two three bed houses in Durham with a 200% higher rental yield and 30% lower stamp duty bill.
And with another example people with £500,000 to invest can either buy a one bedroom flat in West London or five two bed properties in Bradford with a 40% higher yield and costing 50% less in stamp duty.
Of course in the past few years London landlords have profited from substantial capital gains, making it more profitable to invest in the capital than rental yields suggest.
Christian Faes, chief executive and co-founder of LendInvest, said: “London rentals have long been seen as a market within a market, and the results of this study emphasise that fact.
“It’s no surprise that you can get as many as 10 similarly-sized properties in some cities for the same price as a single property in London. But it is surprising that those non-capital properties offer a far more impressive rental yield, and a smaller total stamp duty bill to boot.
“The current market is creating a huge opportunity for ‘cross-country landlords’ – professional landlords who live in one city, but rent out houses in other cities across the UK.
“Cities like Brighton and Southampton are becoming more popular with commuters thanks to the transport links into London, and developments like HS2 will prove an additional boost to areas in the Midlands and beyond.”