Best places to buy to let in the future

If you’re looking to buy an investment property, where should you buy?

Published: May 23, 2018

Where are the best places to buy-to-let in the future?

While the rules may have got tighter and tax breaks less generous, investing in a buy-to-let property can still provide decent returns. So, if you’re looking to buy an investment property, where should you buy?

Lower prices and higher yields in northern cities should mean landlords continue to make a profit, while those in London and the Southeast are set to lose out.

Considering the new tax rules and assuming a 2.5% rise in interest rates; Manchester is the place to future-proof your portfolio in 2020, with an average annual profit of £5,400. The top 20 safe havens are dominated by the North and the Midlands, while the 20 worst loss-makers are in the South and East, led by Cambridge which could see a loss of up to -£4000.

In London, the smart investors are jumping out of fashionable Islington and into in cheaper areas such as Barking and Dagenham. The worst affected area is set to be pricy Kensington and Chelsea, with an anticipated loss of -£13,368.

Once new tax rules hit in 2020, if interest rates rise by 2.5%, these places are set to yield gross annual profits of:

 

The best places to buy-to-let

Nationwide

Manchester £5,439

Cardiff £3,940

Durham £3,928

Leeds £3,819

Loughborough £2,963

Bournemouth £2,882

Chelmsford £2,803

Nottingham £2,777

Oxford £2,733

Newcastle £2,656

London (excluding City)

Barking & Dagenham £2,231

Newham £1,427

Merton £621

Tower Hamlets £575

Havering £151

 

The worst places to buy-to-let

Nationwide

Cambridge -£3,988

Winchester -£3,683

Falmouth -£3,488

Salisbury -£3,127

Chichester -£2,749

London

Kensington & Chelsea -£13,368

Hammersmith & Fulham -£7,392

Haringey -£4,700

Islington -£4,348

Richmond -£3,623

 

Source: Property Partner, based on Zoopla average asking prices and rents

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