The UK’s Best vs. Worst Postcodes for Buy-to-Let Investing

UK buy to let hotspots vs. coldspots, June 2017, by Aspen Woolf

In order to gain an edge in the investment market, it pays to take notice of which postcodes offer the best yields, and which ones produce the worst. We have analysed the recent data from TotallyMoney.com, comparing the top rated areas across the UK with the worst performers to show you where you should consider investing your hard earned money.

 

UK Hotspots vs. Coldspots

Northern cities dominated the Top 10 best postcodes for potential buy-to-let yields. With five entries in the Top 10 – including taking spots one to four! – Liverpool is clearly the top city in the UK for buy-to-let yields. Whereas the places with the lowest yields were generally expensive areas in the south, most notably London. Poole, on the south coast, sits at the bottom of the table with just 1.40% average yields for buy-to-let properties.

 

UK Top 10 Buy-to-Let Property Hotspots V.S Coldspots

UK Top 10 Buy to let hotspots vs coldspots table, June 201, by Aspen Woolf

When looking at the two sets of figures side by side, the contrast is stark. Liverpool’s L7 postcode towers over the bottom ten, bringing in a yield nearly 12x higher than Poole’s BH14. But even comparing the lowest of the top 10 with the highest of the bottom 10, there’s still a difference of nearly 8%, with Sheffield’s S2 postcode averaging yields of 9.73% compared to the average of just 2.05% found in London’s W11.

 

UK Top 10 Buy-to-Let Property Hotspots V.S Coldspots

UK Top 10 Buy-to-Let Property Hotspots V.S Coldspots graph, June 2017, by Aspen Woolf

These figures show just how important it is to consider investing outside the capital, and in particular to look to the North of England for the best returns. It also specifically demonstrates the difference between London and one of the UK’s biggest northern cities: Liverpool.

 

London vs. Liverpool

London has long been thought of as a beacon for finance, and particularly for property investment. But with prices soaring in recent years, the UK’s capital city has become a less economic choice for investors. Indeed five of the worst performing postcodes in this research are in London. Conversely, Liverpool has been surging in popularity with those looking for buy-to-let property. This is thanks to a combination of house prices that are lower than the national average, many large-scale regeneration projects bringing in massive investment, and the booming reputation of Northern Powerhouse cities.

 

UK City Comparison: Top 10 Hotspots – London V.S. Liverpool

UK City Comparison: Top 10 Hotspots - London V.S. Liverpool table, June 2017, by Aspen Woolf

When lining up the two cities side by side, the difference is truly staggering. London’s best performing postcode, E13, is well behind Liverpool’s top placed area, L7, with a whopping 11.08% between them. And even when you compare E13 to Liverpool’s 10th best postcode, L33, there’s still 1.44% extra to be made in the Northern city.

 

UK City Comparison: Top 10 Hotspots – London V.S. Liverpool

UK City Comparison: Top 10 Hotspots - London V.S. Liverpool graph, June 2017, by Aspen Woolf

In this tale of two cities, Liverpool is the clear winner. When you can make more than 3x the yield in Liverpool than can be achieved in London’s best postcode, the choice of which city to invest in becomes a pretty easy one.

 

If you want more information on where is best to invest, take a look at The UK’s Top Buy-To-Let Hotspots in 2017 Revealed! and The UK’s 5 Best Student Towns to Invest In.

And if you’re ready to begin your investment journey, have a look at the properties we currently have available and get in touch!