The latest buy-to-let figures from 2017 show plenty of shifts in the market, with a new city hitting the top spot and more emphasis on the centre of the UK.
First place in LendInvest’s quarterly December 2017 Buy-to-Let Index Report looking at the best buy-to-let postcodes goes to Manchester, knocking Luton off the top spot.
Manchester has the highest average rental yields of all the regions in the index at 5.55%, as well as the top rental price growth at 5.76%, with relatively strong performance in capital gains at an average 8.34%. The city’s strong rental market has made it an increasingly key spot for investors looking for good yields, and the final quarter’s boost will further add to the attraction of the area.
In second place on the list, Colchester recorded yields of 3.78% on average, while the city’s capital gains were the highest in the country at 11.96%, again making it an alluring spot for investors.
Luton fell to third place in the rankings after being listed top in the previous quarter’s index. But the commuter town still saw strong performance over the past 12 months, with average rental yield at 4.03%, capital gains higher than Manchester at 9.16%, and rental price growth of 5.26%.
Other top performers, from fourth place to 10th, were Rochester, Southend-on-sea, Hull, Romford, Norwich, Leicester and Ipswich.
Climbing the ranks
Hull is the postcode that has seen the most significant change over the past year. It has gone from a lowly 99th place at the end of 2016, up to number 6 in the rankings now, an extraordinary 93 places higher. It now boasts an average yield of 4.2%, capital gains of 8.46% and rental price growth of 2.8%.
Cambridge has also made big gains as a buy-to-let hotspot this year, shifting 69 places from 83rd place to 14th, and Slough has moved from 79th place in the index up to 16th spot.
Norwich is also climbing the ladder after entering the top 10 for the first time, and the Midlands in general has been labelled as one to watch, with Leicester climbing to 9th place, Birmingham rising to 11th, and Nottingham making it to 24th place.