Southern cities dominate as buy-to-let hotspots for landlords are revealed

Northern cities may dominate the tables for house price growth but a different picture is emerging for the rental market.

New analysis claims to have uncovered the best UK cities for a landlord’s buy-to-let investment.

The research by Aldermore assesses and provides a score for the average rent per room per month, short-term yield for a new buy-to-let purchase, average property price rises over the past 10 years, proportion of vacant properties in a city and size of the private rental market across the UK.

Seven of the top 10 cities for landlords were in southern England while only three northern cities – Manchester, Liverpool and Newcastle – make the top 25.

Yorkshire has three cities in the bottom six while Nottingham was the only city from the Midlands in the top 10.

Despite having among the lowest short-term yields, Oxford comes out on top with the highest overall score in the index of 74.

Manchester and Edinburgh are just behind with 72, and London has 71.

The research shows London ranks first for total rents, while Liverpool has the best short-term rental yields.

Cambridge got the highest score for price growth while Cardiff and Oxford were the best areas for low vacant stock.

Damian Thompson, director of mortgages at Aldermore, said: “Aldermore’s Buy to Let City Tracker shows there are still great short- and long-term investment opportunities for landlords.

“The number of people renting in the UK has been rapidly growing, up 1.7m in ten years, so private landlords are an increasingly central part of the housing market as supporting a robust and strong private rented sector becomes more essential.

“The UK housing market has never been a singular thing, instead made up of multiple smaller markets with their own unique conditions and challenges.

“There have been numerous regulatory changes recently and persistent economic uncertainty but this affects every region differently. Going forward, landlords will need continual backing and advice from lenders and the wider industry so they can provide choice, diversity of tenure and quality properties for renters.”

Ranking	City	Region	Overall score
1	Oxford	South East	74
2	Manchester	North West	72
3	Edinburgh	Scotland	72
4	London	London	71
5	Norwich	Eastern	66
6	Bristol	South West	64
7	Nottingham	East Midlands	63
8	Cambridge	Eastern	63
9	Brighton	South East	60
10	Milton Keynes	South East	55
11	Plymouth	South West	54
12	Hull	Yorkshire	49
13	Leicester	East Midlands	49
14	Coventry	West Midlands	49
15	Southampton	South East	48
16	Birmingham	West Midlands	47
17	Liverpool	North West	44
18	Cardiff	Wales	39
19	Glasgow	Scotland	37
20	Leeds	Yorkshire	32
21	Derby	East Midlands	31
22	Sheffield	Yorkshire	30
23	Bradford	Yorkshire	29
24	Newcastle	North East	26
25	Wolverhampton	West Midlands	25

By MARC SHOFFMAN

Source: Property Industry Eye