According to new research, the no 1 BTL hotspot for 2022 goes to the North West, which offers the UK’s best yields, followed by Yorkshire and the Humber, and in third place, Scotland.
New findings from SevenCapital and Zoopla, reveal the top yields expected for 2022 across the UK. The North-West offers the best rental yield with average of 4.41% across the UK, driven by exceptional regeneration projects in the Northern Powerhouse towns and cities and the London ‘exodus’ to the north, accelerated by Covid-19, where prices are less expensive.
Yorkshire and the Humber have also benefited from investment in the North, delivering average annual yields of 4.33%, with an average rent of £697. Scotland has recorded healthy yields of 4.11%, with an average rent of £687 – significantly higher than London that is reaching yields of just 2.9%.
It is expected that during 2022, the Midlands and the North of England will show the strongest price growth, mainly driven by their greater capacity for growth. This will build on their market-leading performance for BTL investors.
UK house prices have continued to rise strongly throughout this year, increasing by 5.6% in the first six months and driven by elevated levels of demand. It’s expected that by the end of the year, the UK will see prices rise by a total of 9.0%.
Savills believes that while transactions and price growth will continue in 2022, it will be tempered by the exceptional growth we’ve seen this year – especially if interest rates start to rise sooner than expected.
Toks Adebiyi, founder and CEO of Clooper, said: “Rental yields can change from postcode to postcode, so it is important that landlords conduct thorough research into potential investment outside their current property portfolio locations, to ensure they achieve maximum yields.
“For example, in Manchester, Leeds and Birmingham, certain postcodes are hitting yields of between 6-12%, as property prices are considerably lower than the South East. Currently, the average UK rental yield is sitting at 3.63%, so anything over that amount can be considered a high rental yield area.
“Landlords considering expanding their portfolio into 2022 have the opportunity to acquire highly profitable properties in 2022, despite looming interest rate rises and potential issues with finance. The good news is that there is an ever-increasing demand for rental properties across the UK.
“Recent research shows that almost 40% of landlords have reported increasing tenant demand throughout the past three months – the highest level since 2016. A further 18.2% said this has grown significantly, while 20.3% stated they have witnessed slight increases. This is according to a survey of more than 750 landlords carried out by BVA BDRC on behalf of Paragon Bank.
“We want to support landlords to find quality tenants faster and cheaper, removing the risk of non-performance. Hence, we have developed an innovative new platform, Clooper which can be used by landlords who are seeking new tenants and are happy for their properties to be listed on Clooper, Rightmove, Zoopla, Prime Location and promoted via Social Platforms.”
“We have no fees upfront until the platform delivers prospects, so it’s free to try. There are no contractual tie-ins and no credit card required to list properties.”
