RENTAL yIELDS & pROPERTY PRICES IN THE UK

As the pandemic impact & government restrictions ease, buyers are now looking to jump back into the property market. With the stamp duty holiday, purchase prices & rental yield data will be analysed more than ever.

New legislation, higher letting agent fees and tax increases, have made the past few years difficult for landlords. For sure the latest stamp duty news will add much positivity to the rental market.

So where should you be looking to target the best yield areas?

Where do you get the cheapest properties with high yield returns?

On the flip side, where should you avoid if you’re looking for rental income?

The below data will hopefully help you find a great place to purchase a property to rent out, we’ve got all the data points covered.

1. Which areas have the best rental yields?

2. Which areas have the worst rental yields?

3. Which postcodes have the highest valued properties?

4. Where is the cheapest place to buy?

5. Cheapest place on average to rent?

6. Where are the highest volumes of sales?

 

Which areas have the best rental yields?

Aside from the absence of London areas, there is one other surprising point to note in this table, which is the appearance of multiple Liverpool postcodes.

Liverpool is a hot spot for landlords looking to capitalise on high rental yields. 5 Liverpool postcodes make up the Top 20 best yield areas.

The highest position outside of England, is the Welsh area of Pontypridd, providing rental yields of 7.6%.

#	Postcode	City/Town	Avg asking rent (pm)	Avg yield
1	L7	Liverpool	859	9.9
2	BD1	Bradford	469	9.6
3	SR1	Sunderland	525	9.6
4	TS1	Middlesbrough	437	9.5
5	NE6	Newcastle	783	7.6
6	CF37	Pontypridd	789	7.6
7	L1	Liverpool	721	7.5
8	S1	Sheffield	696	7.4
9	L5	Liverpool	599	7.4
10	M14	Manchester	1,084	7.3
11	DN31	Grimsby	432	7.3
12	LS4	Leeds	1,075	7.3
13	M11	Greater Manchester	850	7.1
14	L2	Liverpool	757	6.9
15	S3	Sheffield	627	6.9
16	PR1	Preston	682	6.9
17	NG1	Nottingham	874	6.8
18	TS3	Middlesbrough	452	6.7
19	L15	Liverpool	786	6.7
20	IP27	Lakenheath	1,149	6.6

 

Liverpool, King of the North

With Liverpool so dominant, it’s only fair we give the city some more attention.

L7, L1, L5, L2 and L15 indicate are the prime areas in the city, for landlords to capitalise on and gain the best rental yields.

On the below infographic showing the best rental yield postcodes in Liverpool, we’ve also included the average purchase prices in the areas.

 

Which areas have the worst rental yields?

As you would expect, with the absence of London postcodes in the top 20 table, they make up a large proportion of the worst yield locations. The top 5 worst performing areas are made up of London postcodes.

The data isn’t likely to be shocking if you follow the property market with a keen eye regularly.

Over the last few years London has been notorious for its low rental yields, with Landlords opting for the higher capital growth and seemingly resilience to economic downturns.

With London house prices growing more than twice as fast as the rest of the UK, the below data doesn’t exactly represent doom & gloom for London property owners.

 

#	Postcode	City/Town	Avg asking rent (pm)	Avg yield
1	W1	London	2,698	1.6
2	SW7	London	2,996	1.7
3	RG10	Waltham Saint Lawrence	978	1.8
4	CM4	Ingatestone	944	1.8
5	SW3	London	2,654	1.9
6	HP9	Beaconsfield	1,664	1.9
7	SY13	Whitchurch	541	1.9
8	W8	London	2,820	2
9	OX13	Kingston Bagpuize	882	2
10	WC2	London	2,683	2.1
11	SW1	South London	2,595	2.1
12	HR9	Ross-on-Wye	627	2.1
13	N6	London	1,581	2.2
14	AL5	Harpenden	1,393	2.2
15	HR8	Ledbury	676	2.2
16	HR6	Leominster	544	2.2
17	NW8	London	2,453	2.3
18	SW10	London	2,352	2.3
19	W11	London	2,290	2.3
20	NW11	London	1,687	2.3

 

Which postcodes have the highest valued properties?

Of course, the main antagonists in this list are mostly London postcodes.

SW7 poses an average asking price of over £2.16m! This is closely followed by it’s London counterpart W1, with average asking prices of £2.08m.

The fun part of the data is looking at the highest entry outside of London. That award goes to HP9 – Beaconsfield, which resides slightly outside of the M25.

Next in line is Virginia Water, GU25, just making into the bottom of the top 20.

 

#	Postcode	City/Town	Avg asking price	Average £/sqft
1	SW7	London	2,163,488	1,678
2	W1	London	2,087,998	1,666
3	SW3	London	1,673,529	1,736
4	W8	London	1,666,738	1,578
5	London	London	1,502,436	1,676
6	London	London	1,472,981	1,391
7	NW8	London	1,304,518	1,145
8	SW10	London	1,253,623	1,266
9	EC2	London	1,224,475	1,321
10	W11	London	1,202,267	1,391
11	SW13	London	1,159,762	889
12	W2	London	1,062,157	1,262
13	NW3	London	1,058,442	1,092
14	HP9	Beaconsfield	1,048,633	542
15	SW5	London	1,042,906	1,241
16	WC1	London	913,070	1,235
17	KT11	Cobham	896,266	535
18	NW11	London	886,494	716
19	SW14	London	878,977	795
20	GU25	Virginia Water	878,177	501

 

You may also like to read:

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But which postcodes are priced the highest that aren’t a stone’s throw away from the M25?

So if we look further away from London, the postcode who’s properties sell for the highest value is placed at number 65, is S022, Winchester.

The city in the county of Hampshire, resides on the edge of England’s South Downs National Park. It’s known for medieval Winchester Cathedral, with its 17th-century Morley Library, the Winchester Bible and a Norman crypt.

The next postcode outside of London, not a stone’s throw away from the M25, is OX2, Oxford, famed for its world renowned University.

 

#	Postcode	City/Town	Avg asking price	Average £/sqft
50	N14	London	673,607	565
51	TW11	Teddington	669,981	671
52	NW7	London	669,189	572
53	SW18	London	664,622	768
54	HP16	Great Missenden	662,710	432
55	N3	London	654,962	619
56	N10	London	653,774	704
57	RG10	Waltham Saint Lawrence	652,809	451
58	SW4	London	648,888	808
59	SW12	London	648,326	784
60	TW1	Twickenham	646,762	731
61	SW15	London	645,725	739
62	SL5	Ascot	644,067	461
63	SO22	Winchester	642,223	424
64	CM4	Ingatestone	642,021	454
65	IG4	London	642,000	424
66	KT2	London	641,983	654
67	N2	London	637,374	696
68	SW19	London	635,540	699
69	W5	London	632,827	716
70	SE22	London	630,621	710

Where is the cheapest place to buy?

So where in the country can you pick up the cheapest properties? Middlesborough, Bradford and Sunderland pose the cheapest opportunities for property purchases.

Interestingly, these 3 postcodes are in the top for of the best rental yield locations.

 

#	Postcode	City/Town	Avg asking price
1	TS1	Middlesbrough	54,978
2	BD1	Bradford	58,673
3	SR1	Sunderland	65,478
4	DN31	Grimsby	71,105
5	DL4	Shildon	73,637
6	TS3	Middlesbrough	80,958
7	SR8	Peterlee	85,274
8	DH9	Stanley	91,391
9	BB11	Lancashire	91,516
10	L20	Liverpool	91,793
11	BD21	Keighley	91,833
12	CH41	Birkenhead	91,885
13	HU9	Kingston upon Hull	92,755
14	SR5	Sunderland	93,222
15	DL17	Ferryhill	95,380
16	FY1	Blackpool	95,526
17	HU3	Hull	97,043
18	DN32	Grimsby	97,652
19	L5	Liverpool	97,744
20	TS25	Seaton Carew	100,603

 

Lowest place on average to rent

On the flip side, the below table shows you where the cheapest place on average to rent a property.

The DL postcodes dominate proceedings, with Shilton, Ferryhill, Bishop Auckland and Willington towns providing the cheapest rental property locations in England.

 

#	Postcode	City/Town	Avg rent pcm
1	DL4	Shildon	376
2	DL17	Ferryhill	377
3	DL14	Bishop Auckland	377
4	DL15	Willington	387
5	BB11	Lancashire	394
6	BD21	Keighley	395
7	HU3	Hull	399
8	YO15	Bridlington	404
9	TS24	Hartlepool	409
10	TS27	Hartlepool	410
11	TS26	Hartlepool	410
12	NE63	Ashington	413
13	DH9	Stanley	414
14	DN1	Doncaster	416
15	NE24	Blyth	416
16	DH5	NE24	419
17	DN15	Scunthorpe	421
18	BD7	Bradford	424
19	CF44	Wales	426
20	TS25	Seaton Carew	428

Where are the highest volume of sales?

Operating in an area where there is a high volume of sales is a great advantage to estate agents.

More sales results in more commission. The below table shows the top 20 areas where the most sales take place on average, within a given month.

Croydon is the biggest hotspot for sales, with 71 sales per month, with NG5 – Nottingham and BN3 – Hove tied in 2nd place with 65 sales per month.

 

#	Postcode	City/Town	Sales per month
1	CR0	Croydon	71
2	NG5	Nottingham	65
3	BN3	Hove	65
4	LE2	Leicester	63
5	CF14	Cardiff	59
6	LE3	Leicester	58
7	BS16	Bristol	58
8	BN1	Brighton	58
9	NG17	Sutton-in-Ashfield	57
10	BN2	Brighton	57
11	TQ12	Newton Abbot	55
12	PR2	Preston	54
13	CV6	Coventry	54
14	SL6	Maidenhead	54
15	NN3	Northampton	53
16	BB5	Accrington	52
17	LE67	Coalville	52
18	NG16	Langley Mill	51
19	LN6	Lincoln	51
20	LE9	Barwell	51

Data sourced from propertydata.co.uk