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  • Property Yields

    Southampton produces highest BTL yields in U.K. but Northern towns dominate overall.

    Interesting article from Property Reporter:

    Rental yields of 7.82% and private rental accommodation making up almost a quarter of its housing stock make Southampton the best place in the UK for buy to let investors according to research from HSBC.

    Of the fifty towns and cities with the highest concentration of private rental housing stock, Southampton topped the list for rental yield due to relatively affordable housing and an average rent of £901 per month. The relatively inexpensive property prices in Blackpool, Hull, Manchester and Nottingham mean that these four Northern areas make up the rest of the top 5, offering strong returns for BTL investors with yields of 7.81%, 7.77%, 7.60% and 7.55% respectively. In sixth place, Coventry is the only other city offering returns above seven per cent with a yield of 7.13%.

    Despite the high proportion of private rentals in the capital, London does not score highly in terms of rental yields due to the comparably high property prices. The top performing borough in the capital, Southwark, is 13th overall while the affluent London boroughs of Hammersmith and Fulham and Kensington and Chelsea are ranked in the bottom two places in the top 50 due to the high initial outlay to purchase a property, generating returns of just 3.42% and 3.34% respectively.

    Due to London’s high property prices, its rental yields are relatively modest on the whole. Southwark tops the list of boroughs with a yield of 6.15%. Areas in Outer London offer some of the strongest yields in the capital including Newham, Enfield, Brent and Kingston upon Thames. Just three of the top ten areas are in inner London and each of these is in the East of the city, traditionally the more affordable end of the capital.

    [Image: house.png]HouseCritter gets excited by talk of high yields and has bookmarked these related discussions for you:

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    Yield!
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    [Image: 4995468760_6be86655d4_t.jpg]
    general operations director, site owner and moderator - propertytribes.com

    Good news for Southampton!

    Long-awaited plans to improve the area around the city’s central station are set to be approved.

    City council chiefs are expected to approve £2.28 million of improvements to the north of the station, which handles six million passenger movements every year.

    And they hope revamping the look of the dilapidated area could even bring a jobs boost to the city by attracting new businesses.

    Read the full story >>> here.
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    How much of the Southampton yeilds are due to student HMOs?
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    So anyone know what actually happened? This was originally posted 2 and a half years ago. How's Southampton these days for investment?

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    Hi Andrew,

    I bought a 5 bed bed student house in Southampton last year.

    Due to Article 4 and additional licensing, very few C4 properties come on to the market.

    When they do, they generally get snapped up very quickly.

    I thought C24 would cause a lot more to come onto the market. This has not happened.

    The good student houses let very quickly. I put mine on the market on 1/2 and re-let it for next year on 3/2.


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    SOUTHAMPTON City Council has rejected plans to transform a home into a HMO in Bargate on the grounds it would be an "unneighbourly form of development".

    Developers had hoped to change the property at 56 Wilton Avenue into a home for up to three people to live in.

    But last week city council officials refused permission for the development.

    Full/source article

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    Southampton City Council are very rigid in enforcing their Article 4 Direction.

    An Estate Agent told me that he knew of only one owner being granted C4 permissions since 2012 (when the A4D was introduced), in the main student area.


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    I'm an investor in Southampton and built up a portfolio in 2014-16 of mainly young professional HMOs.  I tended to buy existing HMOs and also did a conversion to 6 flats.  I avoided the student areas because its really hard to pick up a good value property without a huge hike for the HMO scarcity.

    I've changed my strategy in the city - picking up lease purchase options where the landlord is tired or the property is empty

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    This is a classic 5-bed student HMO in Southampton.

    https://www.rightmove.co.uk/property-for-...Email=true

    The current yield is ~7.4%. If you'd bought it 5 years ago it would have cost ~ £250k and give a very reasonable yield

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    Fantastic news for Southampton's economy - a strong employment boost in the first quarter of this year has put it in the top ten for growth nationally.

    The UK Powerhouse report is produced by Irwin Mitchell and the Centre for Economics and Business Research (Cebr). It provides an estimate of GVA growth and job creation within 46 of the UK’s largest cities.

    The latest study revealed Southampton’s GVA growth of 2.4 per cent in first quarter of 2018 made it the sixth best-performing city economy in the UK, with Portsmouth and Bournemouth also recording growth of 2 per cent and 1.7 per cent respectively.

    Southampton trailed only to Leeds in terms of employment growth, with its workforce growing by 1.9 per cent to 160,800.

    Full/source article

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