Book a Demo

Whilst tax changes and new licensing regulations for HMOs bring new challenges for landlords in 2018, the rental market remains a solid investment option.

More people are either having to rent while they save up for a deposit to buy a property of their own, or are realising that they will never afford to get onto the property ladder. This means the buy-to-let market is going to steadily grow over the foreseeable future. If you are planning on increasing your buy-to-let portfolio or expanding your investments, where are the best places to buy rental homes?

Rightmove has the answer and has revealed the top 10 most popular cities searched by tenants looking for new homes to rent, excluding the Greater London area.

Top of the list is Bristol, which is a popular university town. Here, the average rent for a 3-bedroom property is £1,499 per month, with an average yield of 3.1% The best yields are on 1-bedroom properties at 4.4%, and these command an average monthly rent of £849. Britain’s second-largest student city, Birmingham, is next on the list. Here, the average rent for a 3-bedroom property is £1,452 a month, with a yield of 4%. The best yield is 1-bedroom properties at 5.1%, with an average monthly rent of £776. The third-most searched city by tenants is Leeds, where the best yield is for 2-bedroom properties at 6.2%, with an average rent of £1,040 a month. Next are Manchester, Nottingham, Liverpool, Glasgow, Cambridge, Bournemouth and Sheffield.

With London properties commanding high prices and fairly low yields, many investors are looking north, especially with the plans for the Northern Powerhouse taking shape.

The Northern Powerhouse is boosting the local economy by investing in skills and transport, for example. The region is already home to more than one million businesses in the private sector and is seeing inward investment increasing faster than the national average. Head of sales at Delph Property Group, Richard Forman, said popular cities such as Leeds, Liverpool and Manchester are attracting a lot of investment. He also suggested investors should take a look at Leicester, which has had a sustained period of inward investment. High-profile companies have moved to the city recently, which has attracted skilled workers. This, in turn, has increased demand for private-rental properties and boosted rental yields. He said that yields are as high as 8.5% because of the high demand for city centre apartments.

Looking for a property inspection app to manage your rental properties? Try InventoryBase today for free