What is a ‘cross-country’ landlord?

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A ‘cross-country’ landlord is one who owns properties in various parts of Britain. Since property prices and rental levels differ in different regions of Britain, many landlords are looking beyond their immediate area in order to find good property investments.

In the past, many landlords tended to buy property in the region where they lived. Their main concern was finding a commercial mortgage at a low rate. Landlords now need to look carefully at the profitability of any rented property they purchase, which can mean looking further afield than their local area. This is especially important in the light of the increase in landlords’ costs, such as the recent reduction on mortgage interest tax relief.

An example of the costs in different areas is a comparison between London and Liverpool. According to the Buy to Let Index, in North London, the average rental yield is 3.86%, while Liverpool’s is 5.5%. To get a commercial mortgage in London, landlords can be required to put down a 50% deposit. In Liverpool, it is relatively easy to find a 75% commercial mortgage for buy-to-let property.

As well as rental yields, capital gains are another consideration for property investors. In some areas, property prices are rising more than others. There are also differences in transaction growth, which measures how quickly property is selling. If there is a high demand for property in an area, then obviously property will sell faster.

Increasingly, landlords are buying ‘cross-country’ in order to maintain healthy profits.

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