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Seasonal Rental Yields Explained

5th Feb 2020

Category: Property advice

In this blog post, we explain why choosing the right time of year to let your property in Nottingham matters!

Whether you're looking to invest, or simply to get the most out of your existing investment, yields are an essential tool for property investors.

The yield of a property tells you how much annual return you are likely to get on your investment. There are a number of ways to calculate yields (and they can often be misquoted) but the simplest way is to calculate a year's rental income as a percentage of how much the property is worth. For example, if your property is worth £100,000 and your annual rental income is £6000 the yield would be 6% (this is known as the gross yield). You can read more about different types of yields and ratios on our previous blog post which explains the concept in depth here.

While yields are most commonly used to differentiate one property deal from another, they're also important for existing landlords to understand too. In particular, they can help you understand the best time of year to put your property on the market in order to get the most out of your investment. We've analysed Rightmove data from the last year (Jan-Dec 2019) to determine the seasonal trends of rental yield.

As you can see from the below table, there's an obvious jump in the summer months through to the end of Autumn, with greater yields achieved in the second half of the year than the first. With this in mind, we would advise landlords to carefully consider when their tenancies are coming up for renewal, in particular, whether their property suits the winter-spring market. For example, if your property is available to let in December (when the rental market is slow and you are more likely to experience a high void period and thus a poor yield) you should consider advertising the property on a 6 month tenancy basis so that it comes up for renewal in summer. You will then be able to sign for 12 month periods and secure a longer let.

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If you have any questions about seasonal yields, or how we could help you in securing the best price for your property please do get in touch! You can use our free instant property valuation tool (linked here and below) to get an idea of how much your property could let for.

Lindsay

Lettings Manager (NFOPP Level 3)

Life-long Nottingham resident Lindsay previously worked as a Senior Negotiator at a fast-paced, multi-branch letting agency. She is fantastically skilled in all aspects of the lettings process and great at building relationships with our landlords. She is excited to dive into her new role as Lettings Manager and has recently completed the Technical Award Level 3 in Residential Lettings and Property Management with ARLA Propertymark.

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