Liverpool and Nottingham are achieving the best rental yields

Liverpool and Nottingham are achieving the best rental yields

Recent analysis from mortgage broker Private Finance, has revealed that Liverpool and Nottingham are topping the charts when it comes to offering the best rental yields for buy-to-let investors in the current financial climate.

With returns of 6.2% for Liverpool and Nottingham, they feature ahead of cities such as Manchester, Birmingham, Cardiff, Southampton, Coventry and Edinburgh, who all made decent rankings.

The average net rental yields in the UK’s top performing buy-to-let markets has increased by 0.9% over the last 12 months, demonstrating that buy-to-let is still an attractive proposition for investors.

One of the key drivers in the uplift of rental yields in the above cities is the ongoing demand for homes by tenants, especially in cities such as Liverpool and Nottingham which have seen increased populations over the last few years.

Getting to grips with the dynamics of supply and demand in the housing market is crucial for investors when trying to identify the best buy-to-let hotspots across the UK. Shaun Church, director at Private Finance, said: “Finding the right buy-to-let location is a careful balancing act. Too large an initial investment makes it difficult to achieve a healthy yield, but landlords must also be confident that property values will appreciate at a higher rate than mortgage borrowing to achieve a long-term profit. Strong rental demand is also key to prevent lengthy void periods that can damage affordability.”