Property investors looking to gain healthy returns from the UK buy-to-let market should look beyond London to some of the country’s most popular university cities, research has indicated.
Comparison website TotallyMoney released a report highlighting the attractive yields available in some of the UK’s regional locations, with Liverpool offering the biggest returns of all.
One of the key drivers of this trend is the strong demand coming from the student market.
A dependable market
Highlighting the opportunities available to investors who are willing to look beyond London and south-east England, the report showed that university cities such as Liverpool, Middlesbrough and Newcastle offer potential rental yields up to seven times higher than those available in the capital.
This is the result of consistent, reliable demand from students, combined with relatively low house prices.
Looking at specific locations, the study put Liverpool’s L7 postcode at the top of the list for typical rental yields, while the city’s L6 postcode was ranked second and L1 area was seventh.
Middlesbrough and Newcastle-upon-Tyne also featured in the top ten.
All of these destinations share the characteristic of being close to higher education institutions and offering lifestyle benefits for students.
TotallyMoney’s head of brand and content, Joe Gardiner, said: “With students flocking to university cities year after year and looking for a place to live, it’s no surprise the student market is a dependable one for landlords.
“Since so many students are looking for accommodation, landlords may use this as an opportunity to drum up competition between them.”
Liverpool in particular is currently offering a number of enticing opportunities for investors, such as Aura Student Liverpool, a complex of apartments situated in the Knowledge Quarter. This is the closest new-build student development to the University of Liverpool.
Features including fully furnished studio accommodation, high-speed internet, free Wi-Fi, a games room, a fully equipped gym and 24-hour CCTV coverage help to ensure this development will attract strong demand from renters.
Experience Invest is also offering investors assured net rental returns of eight per cent for five years.
The same assurance is available at Opto Student Newcastle, a development comprising 227 self-contained studio suites in the city’s popular quayside area, less than 15 minutes’ walk from two universities.
Upon completion, the building is set to prove popular among the thousands of students who are currently unable to access purpose-built university or private sector student accommodation in Newcastle.
For investors looking for strong returns from this lucrative asset class, it’s clear that cities such as Newcastle and Liverpool have a lot to offer.