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Where are the best places to invest in the UK?

Despite London being the epicentre of the UK property market, rental returns on buy-to-let are biggest in towns andInvest in the UK cities like Manchester, Southampton and Nottingham, but where is the best place to invest in the UK? – where one in four homes are now privately rented.  Many buy-to-let landlords are looking far beyond London and identifying areas where yields are almost three times as high as in the capital. Cities offering the greatest yields include Manchester, Southampton, Blackpool, Nottingham and Hull.

Where is the best place to invest in the UK? Here are the latest figures.

From lender HSBC, also shows the proportion of property in each area already owned by landlords. And in many of the top-yielding areas private landlords already own one in four properties, or more. Southampton, with rental yields of 8.73%, currently tops the list for rental returns. Manchester, Nottingham, Blackpool and Hull complete the top five locations with the best rental yield at 7.98%, 7.67%, 7.63pc and 7.47% respectively.

These areas also offer the characteristics that make for excellent buy-to-let investment because of the relatively low house prices, coupled with strong demand for rental property from large student and young professional populations.  London is often seen as the haven of property investment with many believing the streets are paved with gold. However, while the highest rents in the country are an attractive draw for landlords, high house prices in the capital squeeze yields and limit the returns available. As a result, returns can often be far more attractive in other areas, so it certainly pays for landlords to do their research.

So if you decide to invest in buy-to-let property in a regional centre like Manchester, the big question is what is the best way of managing this? If the property investment is to provide an extra income or a pension, it is best to use an agent. But if you want to be a full time investor, and have the time to do so, it’s best to go it alone. Whatever you do, make sure you carry out thorough research, before making any decisions on how you will manage your investment.

The biggest challenge for any landlord is finding tenants. It is important to secure the right tenants to ensure your property is cared for; the rent is paid on time; and you prevent void periods. Deciding where to advertise your property; screening tenants; sorting the tenancy agreement; and organising the inventory can be time consuming. And the longer it takes to find tenants, the less revenue you will have.

Agents’ fees for a yearly management charge will probably equate to two months’ rent.  A good agent will have a waiting list of potential tenants ready to move in as soon as the property is vacant, almost paying for their service immediately. Agents will charge between 10%-15% to manage your property portfolio. But in the case of student lets, it is usually only 1%-1.5% of the total yield, still leaving a very healthy 9-10% return on investment each year.

If you have an agent looking after your property, all you have to do is check your bank account to make sure your investment yield has paid. You won’t have to worry about obtaining the correct licenses and keeping them up to date; paying utilities; organising repairs; resolving tenant complaints; chasing rent arrears; and providing the annual gas, electricity and PAT certificates. Some local council require you to get HMO selective licences and if you don’t have this you can be liable for a fine up to £20,000.

Another important consideration is that if you want to purchase the right investment property, regardless of its location in relation to where you are based, you can do this as an ‘armchair investor’. You can take advantage of some of the best yields across the UK, for example student accommodation in the North West, with the help of the right property investment firm.  The secret to a successful ‘armchair’ investment is to work with the right partners. It is important to buy from a developer with a proven track record; use a letting agent that specialises in the rental sector you are looking to be in e.g. student, residential, DSS, commercial or retail. Each of these is a specialist field and if not undertaken by an experienced agent, can lead to the failure of a potentially good investment.

For further information, please visit our website or call 0800 500 3015.

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Young professionals ‘hutching up’ jumps to 23%

A new report revealed..hutching up

The number of young professionals who are choosing to live in HMO accommodation has increased.

The research by The Mistoria Group has revealed that there has been a 23 per cent increase in the number of young professionals that are preferring to live in HMO accommodation at a fixed rental which includes all bills, rather than renting their own house or flat.The rise has been happening in the North West according to the report as hutching up has been more of a phenomenon in London.

However, Mish Liyanage, Managing Director of The Mistoria Group says that in cities like Manchester, expensive accommodation is causing graduates to change their options on living arrangements.

“We are finding that the demographic of our tenants is changing, as many graduates opt to stay in the properties after graduation.  The cost of setting up on their own is just too expensive.  Houses that have been ear marked as student lets are now becoming tenanted by young professionals,” said Mish.

“For many professionals, not having to set up electric, gas, broadband and TV accounts and find £000’s in deposit and first month’s rent, is a massive thumbs up for their wallets. Having the luxury of being able to budget, without having fluctuating monthly bills, has all contributed to the rise of hutching.”

Mish believes that the astute landlord will now be able to adapt to the needs of young professionals as renting a property which doesn’t include bills is now out of the question for most of them.

“Furnished accommodation in or close to city centres tends to be rare and expensive.  The astute landlord who has noted the hutching up trend and has upgraded his/her property to meet the expectation level of this new tenant, will reap the benefits,” added Mish.

“Young professionals will rent for a 12 month tenancy, as opposed to students who traditionally will only rent for 10 or 11 months, increasing their annual yield on the property by 2-3 per cent.”

For further information, please visit our website or call 0800 500 3015.

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Hutching up is not just a London trend

‘Hutching up’, which involves young people squeezing into smaller accommodation to meet soaring rental costs is HMO Letting agentsno longer just a London trend, according to The Mistoria Group, leading student property investment specialists.

What does Hutching up mean?

Across many cities in the UK, flats, houses and HMOs are filled with young people who can only afford to live independently if they share accommodation and squeeze into small rooms with affordable rental charges. Mistoria the HMO letting agents specialist has seen a 15% rise in the number of young professionals in the North East, renting self-contained rooms in HMOs to save money, over the last 12 months.

The cost of renting a home in the UK has reached an all-time high, according to recent research. Tenants are paying an average of £811 monthly rent, according to the HomeLet Rental Index for June, representing a 3% rise on the previous month and a 5.1% increase on a year earlier. The figure represents the highest average UK rental amount on record, as eight of the 12 regions tracked by the survey saw average rents rise last month.

Mish Liyanage, Managing Director of The Mistoria Group comments: “Many young people are finding it prohibitive to rent on their own and there is certainly a growing trend of flat and house sharing amongst young professionals. Whilst sharing accommodation has been the domain of students for many years, many graduates are finding that they can’t afford to live independently.   Having stayed in a good quality HMO as a student, not surprisingly graduates see no reason to change when they faced with a huge hike in rental costs.

“While many young people dream of having a place of their own, the fact it is that many have to live in over-crowded accommodation.  We have seen lots of young professionals take on our student lets – mainly a room in a HMO, with a shared kitchen and sitting room. They are finished to a very high standard and require just £80-£110 a week, including all bills and require just a £200 deposit and £100 admin fee per tenant.”

“The quality of HMO accommodation has improved dramatically over the last few years. Young professionals are very discerning and large flat screen TVs, leather furniture, high speed broadband and en-suites are all quite standard now.  Landlords can no longer cram as many people in as possible to maximise rental income.  A property with three medium/large rooms finished to a very high spec will easily rent for £80-110 per week, compared with four small rooms with a poor spec at £65-75 per week.”

“Many young professionals ask themselves, is it better to share a house in the right part of town close to work and leisure facilities, than rent a flat in a less desirable but more affordable out of town.”

“Location?  For many, not having to set up electric, gas, broadband and TV accounts or pay council tax and find £000’s in deposit and the month’s rent, is a massive thumbs up for their wallets. Having the luxury of being able to budget, without having fluctuating monthly bills, has all contributed to the rise of hutching.”

For further information, please visit or call 0800 500 3015.