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Nottingham's Buy-to-let growth still leading the way.

13th Jan 2017

Category: Local property news

Tagged:property investment, House Prices

Despite headwinds within the UK buy-to-let industry, research shows that Nottingham is still one of the best places to achieve a strong rental yield.

With interest rates remaining at historic lows, investors are still left without much choice if they want to achieve better than 1 or 2 percent that is offered to them by high street banks.

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Nottingham has once again come near the top of the national tables for rental yields - the ratio between rental income and the property's value- achieved (beaten only by a handful towns in the North and North East of England).  Whilst perhaps not the only figure to concentrate upon, the gross yield will give a indication on the return of income based on the amount invested.

For example:

Property purchase price: £100,000

Monthly rent: £417pcm

Yearly rent: £417 x 12 (months) = £5,000

Gross Yield: yearly rent / purchase price

(5,000 / 100,000) x 100 = 5% gross yield.

Average yields in Nottingham are shown to be around 7-7.5%, which in the context of the wider UK (and return on other financial products) already looks very attractive.  Typically yields in London range from 3-4.5%, which is therefore not surprising that as recently as December 2016, Fionnuala Earley- residential research director of Hamptons - highlighted Nottingham as one of the UK's top spots for new cash investors to purchase property.

The average yield achievable in Nottingham (or anywhere else for that matter) does not tell the full picture either.  As the figure suggests, it is an average, so better returns are available to those willing to do their homework and seek out the very best deals.

Demand factors continue to be strong with Boots and Experian both with their global HQ here, as well as continued investment in growth and infrastructure projects moving forward, not to mention that circa 60,000 University students study here every year.  There are also exciting established and emerging new markets within the City that will give investors opportunity for higher returns in 2017.

For more information about the local market here in Nottingham, why not call one of our property professionals on 0115 9338997, or come in for a chat at 56 The Ropewalk, The Park, NG1 5DW.  We'd love to hear from you!

Tom Kite

Partner BA(Hons) MARLA

An experienced Nottingham Property Specialist and a Founding Partner of Comfort Lettings.

Connect with me on Linkedin


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