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Every landlord wants to gain the most profit on their buy-to-let properties, especially now that the responsibilities of landords are increasing. TotallyMoney have analysed 500,000 properties across England, Scotland and Wales to find out the buy-to-let yield of each postcode.

The best buy-to-let areas

TotallyMoney ranked postcodes by percentage yield. L1 in Liverpool came out as the highest ranked, with 10% yield. The median rental value in L1 is £750, and the median asking price is £90,000. Second at 9.51% return on investment is FK3 Falkirk, and third is G52 Glasgow at 8.71%

Liverpool has 5 other postcodes in the top 25 where the return on investment ranges from 7.13% to 8.67%.

A great place to look for buy-to-lets within England is in the North East. There’s a few cities which thrive with students such as Sunderland, Newcastle and Middlesbrough. The best yields in the North East are TS1 in Cleveland, where the asking prices average around £60,000 with rent prices at £425, giving an attractive 8.5% return on investment. Teeside boasts a 7.6% yield, and Sunderland enjoys 6.9%.

Rank	Postcode	Postcode Town	Properties for Rent	Median Rental Value	Properties for Sale	Median Asking Price	Yield
1	L1	Liverpool	187	£750	368	£90,000	10.00%
2	FK3	Falkirk	30	£495	39	£62,450	9.51%
3	G52	Glasgow	46	£595	66	£82,000	8.71%
4	L11	Liverpool	55	£650	31	£90,000	8.67%
5	TS1	Cleveland	65	£425	34	£60,000	8.50%
6	KA1	Kilmarnock	68	£450	75	£64,995	8.31%
7	L6	Liverpool	153	£575	59	£85,000	8.12%
8	LE1	Leicester	176	£667	116	£100,000	8.00%
9	LS2	Leeds	111	£825	32	£125,000	7.92%
10	S1	Sheffield	219	£750	68	£115,000	7.83%
11	CF43	Cardiff	36	£425	35	£67,000	7.61%
12	TS3	Cleveland	60	£475	63	£74,975	7.60%
13	L2	Liverpool	115	£850	106	£135,000	7.56%
14	PA3	Paisley	42	£425	43	£68,500	7.45%
15	L3	Liverpool	282	£740	360	£119,950	7.40%
16	SR8	Sunderland	85	£450	143	£73,725	7.32%
17	G51	Glasgow	74	£595	31	£97,500	7.32%
18	NE8	Gateshead	148	£575	75	£94,950	7.27%
19	AB11	Aberdeen	173	£600	45	£99,995	7.20%
20	G67	Glasgow	57	£450	65	£75,000	7.20%
21	G32	Glasgow	46	£475	76	£79,995	7.13%
22	L4	Liverpool	136	£475	94	£80,000	7.13%
23	G21	Glasgow	30	£550	31	£92,995	7.10%
24	LA14	Lancaster	50	£500	128	£85,000	7.06%
25	SR5	Sunderland	46	£495	40	£84,950	6.99%

 

The worst buy-to-let areas

The lowest percentage yield on buy-to-let property in the UK falls in AL5, St Albans. Here, the median asking price is £800,000 and rental value is £1,300. St Albans is a commuter location for London workers which may be the explanation for its low score of 1.95% yield.

There are other popular commuter havens in the bottom ten such as RG10 in Reading at 2.26%, and Kingston upon Thames KT7 at 2.20%

Second from the bottom comes Ipswich, IP13. Here, properties can cost £397,500 with the monthly rent of £650; this results in a yield of just 1.96%.

There is a pattern to those locations at the bottom of the return on investment pile; the average house prices are all above the UK’s average of £232,710. If you wish to invest, you’d be better purchasing a cheaper property in a different location where the monthly rental prices create a better yield.

 

Rank	Postcode	Postcode Town	Properties for Rent	Median Rental Value	Properties for Sale	Median Asking Price	Yield
1	WC1X	London	440	£2,825	76	£1,484,408	2.28%
2	RG10	Reading	68	£1,100	34	£585,000	2.26%
3	GU10	Guilford	71	£1,295	116	£699,950	2.22%
4	KT7	Kingston upon Thames	41	£1,350	47	£737,475	2.20%
5	S7	Sheffield	98	£638	61	£350,000	2.19%
6	B73	Birmingham	69	£680	60	£375,000	2.18%
7	W8	London	400	£3,356	59	£1,962,500	2.05%
8	GL6	Gloucester	50	£795	92	£470,000	2.03%
9	IP13	Ipswich	34	£650	62	£397,500	1.96%
10	AL5	St Albans	115	£1,300	107	£800,000	1.95%

 

What if you want to become a landlord in London?

There is high demand for properties to rent in London, as the property prices are so expensive. The best yield in London can be gained in E12, covering Manor Park and Aldersbrook, at 6.04%.

Romford holds 7 of the top 20 locations in London, the highest being RM9 with a yield of 5.46%, and the lowest being RM17 at 4.58%.

The worst buy-to-let postcode in London is W8, Kensington. Here the average property price is a whopping £1,962,500, with monthly rent prices demanding £3,356. This equals a 2.05% yield, which is a small amount for such a large property investment.