Figures by financial website Totally Money has revealed that there are plenty of areas in Britain where landlords can make good profits.
Totally Money looked at 500,000 properties in the UK and found that landlords are struggling in London to make good returns, but in Liverpool rental yields of nearly 13% are possible.
Joe Gardiner of Totally Money said:
“Realising a decent return on a buy-to-let rental property is becoming increasingly difficult… Prospective landlords need to go into property investment armed with the facts.”
He advised buy to let investors focus on areas that can provide the highest rental yields. The most profitable areas include Liverpool, Plymouth, Cleveland, Nottingham, Bradford and Kirkcaldy. Where rental yields range from 8.4% to 12.63%.
The areas to avoid, according to Totally Money, are London and the South East where average annual rental yields are below 2%. This is mainly because house prices have soared in this region.
There are plenty of lenders offering commercial mortgages, and Joe Gardiner recommends that should compare the market to find the best deals. The best way to do this is to use a commercial mortgage broker who can take the arduous work out of finding a range of the best deals for landlords. A broker can also help find a bridging loan for refurbishment work.
Gardiner recommends that landlords keep an eye on their credit report. A poor credit report could result in difficulties when applying for a commercial mortgage.