Buy-to-let landlords abandoning London for better returns in the North

30 July 2020 | General

London-based buy-to-let landlords are increasingly heading to the North West in search of better returns, research from Hamptons International has found.

A third (34%) of London-based investors buying new property in the past year bought in the Midlands and North, up from just 14% in 2015 and 4% in 2010.

Some 41% of London-based investors purchased property in the capital, down from 75% in 2010.

Mish Liyanage, managing director of property investment firm The Mistoria Group, said: “The research shows that just one in four London-based landlords purchased a buy-to-let outside the capital in 2010.

“However, over recent years, landlords in the capital have looked outside the South East for better returns and more affordable BTL property.

“We have seen a steady stream of London investors looking to acquire property in the North West. Since the introduction of stamp duty of second homes.

“A combination of a stamp duty surcharge on second homes and high house price growth has pushed landlords away from the capital and the south east, over the past three years.”

He added: “City investors are looking for property in the North West, especially in the university cities, where they can enjoy yields of between 8-13%.

“For example in Liverpool, investors can acquire a high quality three-bed, fully let HMO near a university, which will house students from £120,000 upwards.”

A landlord investing in buy-to-let in London over the past 12 months faced a £24,600 stamp duty bill on average, compared to £5,330 for an investor buying outside the capital.

This post has originally been featured in Property Wire.