If you are looking to invest into the best buy to let areas in the UK, or interested in the UK property market or you wondering what you should know or do to have a fast investment return by planning the best Buy to Let areas luck in 2019, read forward.
Seen as certain future income investment from investors with enough capital to raise a huge mortgage deposit, buy-to-let option looks very attractive.
The UK savings rates, compared to the return investment you can have with the best buy to let areas, are really law. Also, if compared to the risks you can have on the unbelievable volatility of the stock market. All these factors have encouraged more UK investors to try their fortune investing in the right property hoping its value rising.
We have analysed the market carefully and we love to share, also, some amazing online articles and statistic with you, to have a complete vision of the UK investment market. After reading this article you should have a more deep idea what are the step by step passages to become a successful UK property investor.
if the right market researches are done correctly. The best buy to let areas in the UK are also the spot going fast quickly on the market. The business developers they need to get as much as information and news as possible to make their best investment.
Without losing any time, we start sharing with you this amazing research about the best buy to let areas in the UK in 2019!
Now let’s discover the best buy to let areas in the UK in 2019
The winner is S1 – Sheffield City Centre, average monthly rent net £645, the average asking price £69,995!
Followed by Glasgow.
Also our partner Zoopla, not far ago, have also published a list of the best buy-to-let areas in the UK property market!
Also, this analyse underline the spectacular investment opportunity in universities cities in Scotland, making them up four of the top five places to have the best investment opportunities.
Edinburgh is the best investment opportunity at the moment, and it has been classified itself as one of the best buys to let areas in the UK in 2019. The average rental yield of 6.11 per cent (the statistic has been done using the average asking price and the standard monthly rent of a 4 bedroom property).
This average yield is much higher than the UK average yield of 3.92 per cent. Scotland instead as follow: Aberdeen (5.66%), Dundee (5.11%) and Glasgow (5.07%).
In other parts of UK, we find other numbers a part of Coventry that came in second place with a gross yield of 6.03%.
Following: Warwick 4.78%, Chichester 4.73%, Oxford 4.61%, Bolton 4.58% and Wrexham 4.53%. These are the completed 10 best buy-to-let areas in the UK at the moment.
Which are the worst places?
From the report, we can notice that Welsh university cities can represent a poor return on investment: Carmarthen (2.27%), Swansea (2.68%) and Aberystwyth (3.07%) have got a law gross yield. But also Hatfield (2.41%), High Wycombe (2.83%) and Derby (3%) are in surely not the best buy to let areas in the UK at the moment.
In 2018, Mortgage rates are helping buy-to-let UK investors approaching this kind of investment; you could easily fix a mortgage for five years at around 3 percent interests, with quiet big deposit levels. You need always to check all the aspect of the mortgage, always checks carefully the law rate. Law rates, One day, could rise! Your business plan must cover this point carefully and you need to know if your investment can be profitable in case this happens. Read about the future mortgage rates in this nice article.
Tax regulation will be changed, as buy-to-let property mortgage interest will be increased and it will reach 20 percent tax credit. Read more about the next tax regulations in the UK and how they can impact your next best buy to let areas investment in the UK: Here you can calculate yourself! The telegraph has created a live tax calculator that can be used really easily.
UK homeowners will have to pay an extra 3% stamp duty on property purchases. Read as also Scotland will pay this tax duty and why it is so important.
Despite the possible costing rise of the investment, an expandable number of new tenants in the UK market, the unstoppable rising rents and these improving mortgage deals, have tempted independent UK investors once more. All these factors have encouraged more UK investors to try their fortune investing in the right property hoping its value rising.
As a UK business developer, you should already know that like any other investments buy-to-let comes with no guarantees of any kind, but as any other investment, if done with criteria and following the right business approach can be profitable.
If you believe that bricks and mortar are much safer than stocks options and shares, if you are planning on investing in the best buy to let areas in the UK in 2019, or just want to know more about the UK property market, you need to know these 9 important factors:
Analyse the market deeply
How to find the best buy to let areas in the UK IN 2019?
If you are new UK business developer and you want to invest by buy-to-let, you need to know about the real estate market risks and the profitable advantages. As an expensive investment, make sure buy-to-let is the investment you want to invest into. There is a different kind of investments and maybe your business capital might be able to profit better elsewhere.
Investing huge money into the best buy to let areas means blocking up money in a UK property that may fall in value. This is a risk if compared to a less profitable 5% annual return from an average income-based UK investment fund, or the average rate savings account. For many years, the quiet high-rate savings bank accounts have been considered safe and lucrative investments. In the UK, Now, rates are much lower! Around 3%! In 2019, the return from an investment in UK funds, shares or by an ISA investment trust, the capital growth will be tax-free. Another positive factor is the ability to sell up fast your investment if you need to.
Trying to find the best buy-to-let areas involves risking thousands of pounds to buy a property and typically taking the risks or responsibility of a mortgage. When property prices rise, it is possible to make nice leveraged gains above your mortgage debt, but when the prices fall, your expensive deposit gets hit and the mortgage stays exactly the same.
UK Property investing has advantages and disadvantages! You must know them all. It Can be very lucrative and profitable but also risky. If you personally know someone who has invested his fortune investing in the best UK buy-to-let areas before, they may tell you their knowledge to add on top of this guide.
The UK Property market is growing fast and the more market research you do, the higher is the chances the best buy to let areas will be available for the competitors, making a great profitable investment.
Follow all the property news on websites such as this.
Find the most promising location
A Promising location is not always related to the prices.
A Promising location means an area where people would live in, so where the quality of life is great or will improve in a near future. This location research can be made checking different aspects.
- Good transportation,
- If there are any social or tourism appeal in the area
- If there are any school, student accommodation or university
- If is a recreational area (clubs, events, famous markets)
For the best buy to let areas investment, you should match the kind of property you can financially afford with a location that attracts the kind of people who would want to live in the property you have invested into.
Finding a Promising location is the most important aspect of a successful buy-to-let investment that’s why independent UK investor, usually, tend to invest in the property market close to where they live. They are likely to know their surrounded market better than any other UK location, and they can find faster the kind of property that will do well. In this way, they also have a better control on the property. Anyway as any other investment, looking for different areas, home and opportunities are always part of the point one of this guide: the market research. We suggest our clients watch this government site where you can find all the information about the newly developing areas in the UK.
Prepare an exhaustive business plan and find the best mortgage.
Before you think about investing in the best buy to let areas in the UK in 2019, prepare a proper business plan, write down the cost, maintenance costs and possible profit of the properties you think you may interested and which location, be aware of calculation also the risk of mortgage % and the right timing.
Buy-to-let in numbers means:
- to cover at least 125% of the mortgage repayments, you must know exactly how much the mortgage repayments will be and if it is a tracker allow for rates to rise.
- 25% deposits, as average, for residential rates mortgage deals.
- Usually, The best buy-to-let mortgages rate also come with high arrangement fees. You can get more information on a website like this one:
Before chose any mortgage, take as much information you can, online and directly inside the biggest banks.
– Have a clear idea in case your investment doesn’t work out or the property you have invested into is empty for more than two months or doesn’t sell.
– For a long term investment, 75% of loan-to-value and returning 125% of monthly mortgage payments could be a good achieve.
Future tenants and insurance
Ask yourself what the customers or future tenants looking for. Are students, family or young professionals? Students need a clean and comfortable space but not very luxury or expensive, if they are young professionals it should be modern, close to transport and stylish. If it is a family, probably, more space and well connected, with schools around.
Be aware also about the insurance policy against your tenants failing to pay the rent in time, usually known as rent guarantee insurance. You can find all the info here.
The UK rental yield and costs.
Before spotting the best buy to let area in the UK, compare different property’s values using their yield: the yield is the annual rent received as a percentage of the purchase price. A UK property reaching £10,000 worth of rent that costs £200,000 has a 5% rental yield. If you are buying with a mortgage, to calculate your annual return on investment, you need to calculate the mortgage as a cost so, subtract your annual mortgage cost from your annual rent, and work out the percentage of the deposit you put down.
For a £100,000 UK property that investors could rent for £500 per month these days, you need:
- A £25k mortgage deposit and probably £2,000 in extra buying costs.
- At least, £75k mortgage at 5% interest rate will be around £312.50,
- If £500 is the rental income x 12, it means £6,000 earned by your let,
- We have a Difference of pounds 2,250.
- The mortgage Deposit + investment buying costs = £27k.
The Annual return, in this case, would be = 8.3%, don’t forget tax, maintenance costs and other expenses!
Once rate mortgage costs, maintenance costs, extra costs and tax are all inside your business plan, you are ready to start looking already into the UK property market with fewer risks.
Consider looking for a property that needs improvement.
Looking at properties that need structural improvements could be a way of boosting the value of your investment over time. Properties in need of renovation can be negotiated very well on to get at a better price and then after the renovation, it is easy to add value. This could be a real way to see a solid return on your capital invested. Before making this kind of investment, calculate if the price is cheap enough to cover the future refurbishment and gain some profit and before close the deal, keep the refurbishment on the business plan as costs.
A common rule to follow as UK property developers’ calculation is the price property with no renovation, plus the cost of work, plus 20 per cent.
As best buy-to-let areas investors you must know how to negotiate the price if the market is slow and homes are taking longer to sell you will be better able to negotiate a better price. Ask always why someone is selling their property and how long they have owned the property they want to sell. Families, landlords and developers they have different needs and different selling time. To learn more about price negotiation, please read here.
Knowing the risks and negative aspects
Before you make any investment you should always question and finding the answers to the negative aspects, ask yourself these questions:
- If your UK property prices collapse will you are able to continue holding your investment?
- When rates are low people invest in the best buy to let areas, simple covering the mortgage, but what will you do when rates rise?
- What will happen if you can’t remortgage for any reasons?
The best buy-to-let investors don’t let the property sitting empty for two months of the year! Properties need maintenance repairing and things can go wrong (bad tenants, external factors). You need enough funds in the bank to cover a major repair to your property, if you don’t have enough money coverage, do not invest yet.
The consequences of buying a property
Best buy to let areas in the UK: landlord’s investment returns are the void period!
That unprofitable time when the landlords don’t have any tenants in the property. The tenants who enjoy staying in your property, help fix this problem, recommending your property to someone else.
Keep your property clean, and try and build a good relationship with your tenants.
As you can see the things to do before buying a property are huge, but after, you will need to find tenants, or maybe sell the property quickly to gain extra profit. You can rent out yourself or use high street agents. Agents will charge you 1.8% fee in 2019 as average. That’s why we have created our platform. You can save huge money by renting or selling the property by our internet estate agency.
To help you gain more knowledge about the property market, we analyse the market deeply; we use different tools but also we share and analyse the statistic of our partners: the leading online property portals; to which we are partners since when our company has been founded. You can read more about our partners in our blog section and why we have chosen these particular property players.
At iMoveEstates, we help to find out where UK business developers should buy and which areas are the most profitable one. We also help UK developers to sell and rent their property quickly through the usability of our online platform. We have developed a special company section only structured to help UK property developers to rent or sell their property fast. We will advertise your property on the UK major property portals and sell your best buy to let areas properties really fast, helping you with all the documents, tenants and saving a huge amount of money. Find out more about it here, this blog section is made to help you find out the best business opportunity.
Future UK property developers, after reading this post, should have gained enough knowledge to run a deep market research to find the answers to these questions:
- How and where to invest in buy-to-let properties for the best rental and capital yields in all UK?
- Are you investing to make a buy-to-let business for families or for a student property?
- Where are and why I can find the best buy-to-let UK areas in 2019?
For any questions you may have or if you still not sure about the UK property market, please don’t hesitate to contact us!
Marketing Director , iMoveEstates