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Oxford is the best UK city for buy to let property investment, according to the latest Buy to Let City Tracker from Aldermore.
The buy to let city tracker was determined by analysing and assessing five key indicators that impact desirability; average total rent, the best short-term returns through yield, long-term return through house price growth over the past ten years, the lowest number of vacancies as a proportion of total housing stock, and percentage of the city population in the rental market.
Oxford leads the way out of the 25 cities analysed by the tracker, followed by Manchester and Edinburgh. London lies in fourth place, with Norwich rounding off the top five.
The South East is the best region for buy to let investment with three cities making the top ten; Oxford (1st), Brighton (9th), and Milton Keynes (10th).
Cities in Yorkshire fare worse with two in the bottom five – Bradford (23rd) and Sheffield (22nd) – with Leeds in 20th place
Wolverhampton sits at the bottom of the tracker list, despite other cities in the West Midlands such as Birmingham and Coventry performing impressively
London is top for average total rent, Hull has the best short-term returns through yield, Cambridge was number one for long-term house price growth, Cardiff has the lowest number of housing vacancies, and Oxford has the highest percentage of population renting.
Oxford’s rapid growth and investment has narrowly won the city top spot in the City Tracker, with good scores on four out of five metrics. Oxford’s main selling point for private landlords is that it has one of the largest private sector markets of all 25 cities, with 28 per cent of all residents in the city renting privately.
This is combined with above average rental ability (on average £596 per room per month), a low level of vacant properties, and security in investment with property prices having increased yearly by on average 4.8 per cent the past decade. The only sore spot is that short term return through yield is one of the lowest on the list.
Damian Thompson, Director of Mortgages, Aldermore commented: ‘Aldermore’s Buy to Let City Tracker shows there are still great short and long-term investment opportunities for landlords. The number of people renting in the UK has been rapidly growing, up 1.7 million in ten years, so private landlords are an increasingly central part of the housing market as supporting a robust and strong Private Rented Sector becomes more essential.’