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The scariest places to be a landlord

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The nights are long and cold and Halloween is fast approaching, so innovative rental platform, Bunk, has looked at where across the UK is the scariest place to be a landlord based on the current rental yields available.

On a national level, Wales is home to the most spine-tingling yields available at just 3.8%. A more worrying financial return than England (4.2%), Northern Ireland (5.4%) and Scotland (5.8%).

On a regional basis, the East of England is the most frightful at just 3.6%, with the South East and South West not far behind at just 3.7%, and the East Midlands also slipping below the four percent mark.

But where is currently the most haunting locations for landlords trying to make the best of a devilish attack on the buy-to-let sector, by a ghoulish Government intent on slashing any financial incentive?

Chiltern in Buckinghamshire is home to a chilling average rental yield of just 2.8%, along with Monmouthshire which shares the monstrously low average yield for landlords. 

South Bucks, Charnwood, Cotswold, Suffolk Coastal, Powys, North Norfolk, East Devon, Kensington and Chelsea and Rushcliffe form a zombie horde of locations where the average rental yield is at just 3%.

Maldon, West Devon, Bromsgrove, Shepway, Purbeck, East Renfrewshire, Malvern Hills, Derbyshire Dales, and East Hampshire complete the top 20 scariest places to be a landlord with yields of 3.1%. 

Co-founder of Bunk, Tom Woollard, commented:

“Being in the buy-to-let space can be frightful for a lot of reasons but while many can live with often temporary issues such as a nightmare tenant, a poor return on your investment is perhaps the most blood-curdling situation a landlord can find themselves in.

This Halloween, many buy-to-let investors will find themselves in the darkest spot they have been in some time, however, there are plenty of positives to take from the changing face of the UK rental sector.

By utilising the latest innovative tech platforms and products and reducing unnecessary running costs and high management fees, you can resurrect your investment and get it back in the green.”  

National – by worst rental yield
Region Average Rental Yield (2019)
WALES 3.8%
ENGLAND 4.2%
NORTHERN IRELAND 5.4%
SCOTLAND 5.8%
   
Regional – by worst rental yield
Region Average Rental Yield (2019)
EAST OF ENGLAND 3.6%
SOUTH EAST 3.7%
SOUTH WEST 3.7%
EAST MIDLANDS 3.9%
WEST MIDLANDS 4.2%
LONDON 4.4%
NORTH WEST 4.5%
YORKSHIRE AND THE HUMBER 4.5%
NORTH EAST 5.1%
   
Top 20 – Current worst UK rental yields
Location Average Rental Yield (2019)
Chiltern 2.8%
Monmouthshire 2.8%
South Bucks 3.0%
Charnwood 3.0%
Cotswold 3.0%
Suffolk Coastal 3.0%
Powys 3.0%
North Norfolk 3.0%
East Devon 3.0%
Kensington and Chelsea 3.0%
Rushcliffe 3.0%
Maldon 3.1%
West Devon 3.1%
Bromsgrove 3.1%
Shepway 3.1%
Purbeck 3.1%
East Renfrewshire 3.1%
Malvern Hills 3.1%
Derbyshire Dales 3.1%
East Hampshire 3.1%
   
Sources
Average House Price Gov.uk
Average Rental  
England Gov.uk
Scotland Gov.scot
Wales Gov.wales
Northern Ireland Ulster University

Property

Cost of maintaining a buy-to-let hits £12k a year in parts of the UK

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Leading property management platform, Howsy, has looked at the cost of maintaining a buy-to-let property each year and how this varies across the UK.  

Buy-to-let can be a tricky business if you don’t tackle it properly and there are a whole host of costs that can trip up the amateur investor. From the more obvious additional three percent stamp duty tax, to various other tax implications, void periods, mortgage costs, agency fees, the cost of finding a tenant, and more, Howsy’s previous research shows the average buy-to-let brings an annual return of just £2,000.

With the Government’s continued attack on UK landlords, making the most out of your investment financially can be tough and even when you consider all financial commitments for a property, many can still be caught unaware by out of the blue maintenance and repair costs. 

Buy-to-let landlords should squirrel away savings in anticipation of these events and an industry rule of thumb is an annual budget equivalent to 1% of your property’s value. 

So what does that equate to?  

Across the UK landlords should be tucking away an annual budget of £2,344 to cover repairs and maintenance, with this rising to £4,746 in London, with the North East home to the lowest repair costs at just £1,328. 

Of course, markets with higher rent returns may seem promising from an investment standpoint but the higher the reward, the higher the cost when things do go wrong. In Kensington and Chelsea, this annual 1% saving climbs to an eye-watering £12,292, hitting nearly £9,000 in both the Cities of London and Westminster.  

Outside of London, South Bucks and Elmbridge are home to the most expensive buy-to-let maintenance costs at £6,091 and £6,019 respectively.

Head to the likes of Burnley or Blaenau Gwent however, and this yearly maintenance budget drops to less than £1,000 a year.

Founder and CEO of Howsy, Calum Brannan, commented: 

“The buy-to-let sector can be a minefield for the amateur investor and now more than ever, it’s imperative that you do everything you can to maximise the return on your investment.

While technology now allows a greater level of control and service when managing your investment at a lower cost via online platforms, it isn’t just about the financial side of things. Providing a fit for purpose property is not only a legal requirement but essential to ensure a happy tenancy and a reduction in void periods.

Of course, things can go wrong and having the budget available to fix them is a must. In the worst-case scenarios, a cash pot equal to one percent of your property’s value might not be sufficient, but it should cover you for most eventualities and is a good benchmark to start on.

As with all buy-to-let investments, good preparation, organisation, and education are key, and whether you go it alone or have a great management agent if you stay on top of things, a bricks and mortar investment is still one of the best you can make.” 

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