LANDLORDS in Scotland 'Getting Best Returns'

August 25, 2004
The Scotsman - Edinburgh,Scotland,UK
... to rent out in Scotland are receiving an average of 8.02% of the property’s value in rent each year

Personal Finance Correspondent, PA News


Investment landlords in Scotland are getting the best returns on their property, figures showed today.

People who buy property to rent out in Scotland are receiving an average of 8.02% of the property’s value in rent each year, according to specialist buy-to-let broker Landlord Mortgages.

This compares with yields of just 5.99% for England and 6.19% in Northern Ireland during the 12 months to the end of June.

Unsurprisingly London offered investment landlords the worst return, with people letting out property there getting just 5.93% a year back in rent.

The group attributed the high returns in Scotland to the lower cost of property there, with house prices averaging just £105,855 north of the border, compared with £140,954 for a buy-to-let property across the whole of the UK.

Scotland was also the only region which has not seen a fall in yields over the past two years, with average yields increasing from 7.27% since the second quarter of 2002 to 8.02%.

During the same period yields in London have fallen from 7.01% to 5.93%, while ones in England have dropped from 7.39% to 5.99%, and in Northern Ireland they have fallen from 7.15% to 6.19%.

Lee Grandin, managing director of Landlord Mortgages, said: “Rising property prices across most of England, especially in London, have seen rental yields steadily fall over the last few years.

“Investors in search of the highest rental yields should consider Scotland where landlords are making an average of 8.02%.

“We believe that this is due to lower house prices north of the border and a lack of good rental property, which has pushed up tenant demand.”

He added that Glasgow, Edinburgh and towns in the Borders were the current buy-to-let hotspots in Scotland, with one-bedroom flats in these places giving the best returns.