Buy to Let - where are people getting good yields?

Buy to Let - where are people getting good yields?

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CIS121

Original Poster:

1,259 posts

212 months

Thursday 11th September 2014
quotequote all
For the last 6 years I've been developing and selling properties around London as a sideline. A sideline that's done very well due in part to rising prices.

I've now got the bulk of my mortgage paid and a pot of about 220k that I've been using to develop and I want to get away from developing to sell, to developing to keep (the ever popular BTL). I've got other good income and want long term investments.

Where are people getting good yields? Yields in London are poor and I have worries about an over inflated market in the South East. Considering Manchester and my work would allow me to be based there during the week when I had a property being renovated.

Who's getting good yields where?

Thankyou4calling

10,595 posts

172 months

Friday 12th September 2014
quotequote all
East Midlands can provide some good returns.

There are plenty of three bedroom terraced houses sold at less than 100k that rent for £500 to £550 per month. If you bought two with your lump sum you'd still have a decent rainy day fund and a 6% plus gross yeild.

Not much capital but reasonably easy to find tenants.

Ade07

489 posts

166 months

Friday 12th September 2014
quotequote all
Regularly achieving 9% to 14% in Liverpool and Manchester areas.

lewisf182

2,084 posts

187 months

Friday 12th September 2014
quotequote all
I'm biased myself but there are areas of leeds & sheffield which have a long way to go before they reach their pre recession peak. Flats around Kelham Island in Sheffield are soaring in price, it is a big up and coming area as it's close to the city centre and land is hard to come by meaning prices will continue to rise as it's such an aspirational place to live.

I bought my flat for £84k there last year and it's now worth about £110k. Interest only mortgage was £220 and it rents for £650 a month so a very good yield! Rents have gone to just below £700 now meaning yields are still pretty decent

Leeds wise there are a lot of areas which have good potential. City centre flats tend to be fairly high priced but developments like city island are still reasonable value and give good yields, plus like I said they still have a way to go before they reach their pre recession peak.
Also areas such as chapel alerton & roundhay attract a lot of young professionals wanting to move away for the city meaning houses/flats are in high demand to both buy & rent. Bargains can be had if you wait for the right places, especially if your willing to pump money in to renovate.

I don't really know much about the Manchester market I'm afraid.

If I had £220k I'd be buying 5 or so flats in the areas I've listed above.

CIS121

Original Poster:

1,259 posts

212 months

Monday 15th September 2014
quotequote all
Cheers folks. I've seen a few ultra cheap houses offering 12%ish - mainly South Wales in the valleys, but this is based on a 35k property and by the time repairs, upkeep and fees come out along with the hassle to reward I don't think the 12% will look so great.

Seen a few around Manchester that work out nearer 8% at 100kish purchase price which looks more appealing. Will take a look at Leeds and Liverpool too - thanks

Rovinghawk

13,300 posts

157 months

Tuesday 16th September 2014
quotequote all
Thankyou4calling said:
East Midlands can provide some good returns.

There are plenty of three bedroom terraced houses sold at less than 100k that rent for £500 to £550 per month. If you bought two with your lump sum you'd still have a decent rainy day fund and a 6% plus gross yeild.

Not much capital but reasonably easy to find tenants.
I have two in this area- £100k to buy, £595pcm. I'm just about to buy another one nearby.

dazwalsh

6,095 posts

140 months

Tuesday 16th September 2014
quotequote all
My hunting ground is Leeds. Last property was 37k purchase, 10k renovation so say 50k all in incl. fees and its let at £650pcm. Large 3 bed semi in an okayish area (LS10).

A lot of cheap back to back type rubbish though going through auctions at the moment.



Thankyou4calling

10,595 posts

172 months

Tuesday 16th September 2014
quotequote all
Rovinghawk said:
I have two in this area- £100k to buy, £595pcm. I'm just about to buy another one nearby.
Excellent return! I like the 3 bed terraced houses in Kettering and surrounding. They're solid and sell for less than a £100k. Let at around £550 so a decent gross return and pretty easy to move on if you need to.

Pit Pony

8,265 posts

120 months

Tuesday 16th September 2014
quotequote all
Thankyou4calling said:
East Midlands can provide some good returns.

There are plenty of three bedroom terraced houses sold at less than 100k that rent for £500 to £550 per month. If you bought two with your lump sum you'd still have a decent rainy day fund and a 6% plus gross yeild.

Not much capital but reasonably easy to find tenants.
I'm looking at Derby for various reasons.

I have a contract coming up in Derby, at a large company, and last time I was there I ended up renting a room in someone's house, 4 nights a week, which isn't ideal. Anyway I was thinking this : http://www.rightmove.co.uk/property-for-sale/prope...
If I spend my evenings doing it up a bit (Budget £5K) I reckon that the rental will be about £400 a month.
My ltd company has the cash, so no need for BTL mortgage.

I rented near here when I had a contract in Derby 3 years back, and can't imagine why this is SO cheap......although it's a guide price.. http://www.rightmove.co.uk/property-for-sale/prope...

Ade07

489 posts

166 months

Tuesday 16th September 2014
quotequote all
Thankyou4calling said:
Rovinghawk said:
I have two in this area- £100k to buy, £595pcm. I'm just about to buy another one nearby.
Excellent return! I like the 3 bed terraced houses in Kettering and surrounding. They're solid and sell for less than a £100k. Let at around £550 so a decent gross return and pretty easy to move on if you need to.
Sorry, but that's not a decent gross yield at all.

tight fart

2,865 posts

272 months

Tuesday 16th September 2014
quotequote all
Looks a good yield to me.

caterhamboy

568 posts

197 months

Tuesday 16th September 2014
quotequote all
Pit Pony said:
I'm looking at Derby for various reasons.

I have a contract coming up in Derby, at a large company, and last time I was there I ended up renting a room in someone's house, 4 nights a week, which isn't ideal. Anyway I was thinking this : http://www.rightmove.co.uk/property-for-sale/prope...
If I spend my evenings doing it up a bit (Budget £5K) I reckon that the rental will be about £400 a month.
My ltd company has the cash, so no need for BTL mortgage.

I rented near here when I had a contract in Derby 3 years back, and can't imagine why this is SO cheap......although it's a guide price.. http://www.rightmove.co.uk/property-for-sale/prope...
Hi pit pony, Brindley court is classed as a very rough part of derby. http://www.derbytelegraph.co.uk/Tenants-form-actio...

it may well get slightly better but in the whole i wouldn't invest here. The 1st flat you linked is around 1/2 mile away but classed as a better area.






Edited by caterhamboy on Tuesday 16th September 21:51

no effort

224 posts

178 months

Tuesday 16th September 2014
quotequote all
Pit Pony said:
I'm looking at Derby for various reasons.

I have a contract coming up in Derby, at a large company, and last time I was there I ended up renting a room in someone's house, 4 nights a week, which isn't ideal. Anyway I was thinking this : http://www.rightmove.co.uk/property-for-sale/prope...
If I spend my evenings doing it up a bit (Budget £5K) I reckon that the rental will be about £400 a month.
My ltd company has the cash, so no need for BTL mortgage.

I rented near here when I had a contract in Derby 3 years back, and can't imagine why this is SO cheap......although it's a guide price.. http://www.rightmove.co.uk/property-for-sale/prope...
I can Allenton.
If you worked at RR you should know this st hole.

Thankyou4calling

10,595 posts

172 months

Tuesday 16th September 2014
quotequote all
hehe
tight fart said:
Looks a good yield to me.

Pit Pony

8,265 posts

120 months

Tuesday 16th September 2014
quotequote all
no effort said:
Pit Pony said:
I'm looking at Derby for various reasons.

I have a contract coming up in Derby, at a large company, and last time I was there I ended up renting a room in someone's house, 4 nights a week, which isn't ideal. Anyway I was thinking this : http://www.rightmove.co.uk/property-for-sale/prope...
If I spend my evenings doing it up a bit (Budget £5K) I reckon that the rental will be about £400 a month.
My ltd company has the cash, so no need for BTL mortgage.

I rented near here when I had a contract in Derby 3 years back, and can't imagine why this is SO cheap......although it's a guide price.. http://www.rightmove.co.uk/property-for-sale/prope...
I can Allenton.
If you worked at RR you should know this st hole.
I know Brindley Court, having rented a room in a house around the corner for about 14 months. I think it's the druggies that get their benefit paid that bring it down further. Nice it isn't.

Having spent 3.5 out of 5 years contracting in Derby, I can safely say I know Allenton, and have witnessed it's reputation.

Hence why I'm more interested in this :

http://www.rightmove.co.uk/property-for-sale/prope...

tight fart

2,865 posts

272 months

Thursday 18th September 2014
quotequote all
Thankyou4calling said:
hehe
tight fart said:
Looks a good yield to me.
I'd have thought anything over 6% was good?
What do others think exceptable?

Ade07

489 posts

166 months

Thursday 18th September 2014
quotequote all
tight fart said:
Thankyou4calling said:
hehe
tight fart said:
Looks a good yield to me.
I'd have thought anything over 6% was good?
What do others think exceptable?
Minimum 8% but usually anything between 9% and 14%

tight fart

2,865 posts

272 months

Friday 19th September 2014
quotequote all
Ade07 said:
Minimum 8% but usually anything between 9% and 14%
That puts 2 bed flats around here at £2500 pcm and an average 3 bed semi at close to £5k a month, Id agree that's very good!