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The M25 orbital motorway encompasses many commuter towns for London workers, so there is strong demand in the private rental sector.
But where are the best spots on the M25 for buy to let property investors to invest in order to enjoy the best rental yields?
Lettings management platform, Howsy, has looked at the property markets surrounding each junction of the famous motorway and the current average yields available for buy to let investors.
North vs South
They looked at junctions around the south section of the M25 in relation to the north section and found that the average rent is higher along the southern stretch at £1,524 per month to £1,352 along the northern section.
So while tenants should head for the likes of Slough, Watford, Enfield, Epping and Romford for a more affordable M25 rental, those looking to invest in a buy to let are better off opting for Leatherhead, Reigate and Sevenoaks. Yields around the southern junctions of the M25 are currently at an average of 4.01 per cent annually, compared to 3.61 per cent along the north side.
Best Buy to Let Yields
For buy to let investors, junction 31 is the top pick for a rental investment with yields currently hitting 5.43 per cent in the surrounding area. Junctions 9 (5.14 per cent), 30 (4.67 per cent), 1B (4.50 per cent) and 15 (4.45 per cent) are also home to some of the highest rental yields on the M25 ring.
Founder and CEO of Howsy, Calum Brannan, commented: ‘Despite the endearing title of Britain’s biggest car park, the M25 remains a vital piece of transport infrastructure and while the focus of many tenants in London’s most central boroughs is always the availability of good public transport, the M25 and easy access to it, can be a very valuable selling point for those in the capital’s peripheral areas.
‘As with any property investment, it’s key factors such as easy transport links that can ensure a sustained level of tenant demand and justify the rental price of a property, which in turn, also helps maintain a healthy rental yield on a property.’
He concluded: ‘It’s interesting to see that unlike central London boroughs, the M25’s southern junctions seem to be the more in demand and home to a higher rental price than the north side, as they provide much quicker routes into the centre of London.’