News from the Residential Property Investor, the bi-monthly magazine for RLA members other artilces from the August / September 04 issue RPI news archive

Landlords striking better deals - August / September 2004

Landlords have achieved average overall returns of almost 25 per cent over the last year, Paragon Mortgages has reported.

What is more, its July Buy-to-Let Index suggested returns have been consistently high across the country.

Seven out of 10 regions provide landlords with a total annual return in excess of 25 per cent. The north overtook East Anglia in generating the highest overall return, of nearly 60 per cent. Wales offered the second highest total return to investor landlords of 43.7 per cent, while Yorkshire and Humberside was in third place, with a similar level of return of 43.2 per cent.

'The total annual return exceeded 30 per cent in three other regions ­ East Anglia (34.9 per cent), south west (33.9 per cent), and east Midlands (33.0 per cent).

Nationally, landlord yields stand at 7.0 per cent this month, slightly lower than in recent months'. With the north was again in top place at the highest was 8.2 per cent, and London and the south east at the foot of the table with yields of 6.6 per cent and 6.5 per cent respectively.

The Paragon figures include both rental income and capital growth.

It found that property values had increased in seven out of its 10 regions, with Yorkshire and Humberside up sharply by 12.1 per cent to £98,114, the North up 11 per cent to £77,169 and Wales up 10 per cent to £109,297.

'Rents also increased in five regions, with the largest increases witnessed in those regions with the highest property price increases'.

But 'there was an easing of yields nationwide this month, with only East Anglia experiencing a small increase from 7.29 per cent in May to 7.30 per cent in June'.

Paragon also pointed to 'further evidence of the continuation of the cooling trend in property values that began in May'.
 

other artilces from the August / September 2004 issue

• Licenced to charge
• Fitness certificate proposed by RLA
• 'Sensible approach' by landlords
• Built-in flood resilience to be required
• Crackdown on estate agents
• Landlords striking better deals
• Conservative plan the 'right to own'
• 'Natural segregation' affects house market
• Spreading the risk
• Watch out for the tender tax trap