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Insight & Opinion

UK buy-to-let investments are generating record-high yields

Author: Gemma

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Property investors in the UK’s highly popular buy-to-let sector are seeing record returns on their spend, according to the latest figures that have been released by LSL Property Services. And there could still be better times ahead, with the start of the autumn rental boom just about to get underway.

According to the LSL Property Services figures, landlords in the UK have seen a return of 12.7 per cent over the past year, which is a record return for the sector. This year, landlords have seen a gross average return of £8,233 in rent and £13,066 in capital gains, the company’s buy-to-let index has shown.

It comes at a time when rents have also hit all-time highs, with LSL reporting that the average cost of renting a property for tenants has reached an average of £761 per month as of August – a 2.4 per cent rise over the course of the last year alone. It also marked a rise of 1.1 per cent over the cost of rent that was recorded in July of this year.

This sets them £3 higher than the previously noted record, which was witnessed in October of 2013. However, with the autumn period being the fastest of the year for the property market, it could still be the case that rents hit a new peak around the same time this year, taking landlords’ income even higher.

David Newnes, Director of Your Move and Reeds Rains, companies owned by LSL Property Services, said the figures in the latest index come at a time when the market has just enjoyed the first of a double boost expected in the second half of the year. Returning and new students, as well as people relocating to take up new jobs, made August a fantastic month for investors.

“Autumn is when more people move to take up new opportunities, to build new careers and to start new chapters,” he added, which will give yet more confidence to landlords moving forward throughout the rest of the year.

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