Buy to let 'generating high yields' in 2012
24th Jan 2012
People thinking of investing in buy to let property may find that focusing on the north of England is the best bet, according to one expert.
Tanya Powley, of FT Money, said there are some areas and towns where landlords can actually get "a very high yield", with the highest being 7.6 per cent observed Burnley.
She noted that a lot of the higher buy-to-let yields tend to come in the north of England where obviously there are lower house prices, but on average London is about 5.1 per cent, south-west is 3.8 per cent, and in other areas like Wales it is around 4.4 per cent.
However, she explained that not every area is achieving very high yields, pointing to the recent announcements by some mortgage lenders that came into the market and started offering 80 per cent loans, which is by far the highest loan value available the buy-to-let market at the moment.
"Even though this is a great headline grabbing thing for these lenders to be offering 80 per cent loans, it is probably going to see quite limited take-up because not many landlords will be able to achieve high enough yield to have access to that 80 per cent borrowing," Ms Powley stated.
© Zoopla Property Group Limited