London used to be top buy-to-let hotspot
Also popular with landlords are properties in Birmingham – possibly because of the planned HS2 high speed rail line – and Bristol, according to Barclays Mortgages.
Slough, home to some of the UK’s largest businesses, is also highly popular, as are university towns such as Bristol, Nottingham and Manchester.
And Plymouth has suddenly become a buy-to-let hotspot, shooting up from 212th in last year’s ranking to 16th now. This, says Barclays, is probably down to its growing economy and £90 million investment pledge from the government.
Two thirds of buy-to-let landlords say the market is ‘buoyant’, and, despite George Osborne’s plans to cut tax relief on buy-to-let homes, fewer than 10% are planning to sell their property.
“It’s encouraging to see home owners are still feeling confident about the rental market and view buy-to-let as a valuable way to support their finances,” says Andy Gray, Barclays managing director of mortgages.
“Whilst London still leads all things buy-to-let, areas like Plymouth and Peterborough show there are some great value hot spots outside the capital city that are worth investment as the economy grows.”
More than three quarters of buy-to-let landlords own more than one property. Those in Bradford and Glasgow leading the way, averaging a huge eight properties per person. Over half manage their properties themselves.
While most say they prefer traditional houses, London landlords may have less choice, with more than half of owners buying flats.
In London, the average rent is £1,900-a-month, with outlying areas also doing well: £1,268 in Enfield and £1,262 in Croydon, for example.
But while this may be good news for landlords, it’s not so great for renters. According to a recent government housing survey, they are now forking out 43% of their income on housing costs – compared with 31% for those who live in a social rented home, or 19% of those with a mortgage.
Rank Town Average rent Q1-Q2 2015
1 1 London £1,900
2 7 Birmingham £766
3 3 Bristol £877
4 17 Nottingham £639
5 18 Manchester £693
6 13 Reading £1,169
7 47 Leeds £703
8 6 Southampton £1,067
9 50 Peterborough £649
10 19 Slough £1,045
11 48 Glasgow £601
12 5 Ilford £1,252
13 4 Harrow £1,402
14 35 Edinburgh £923
15 8 Croydon £1,262
16 212 Plymouth £808
17 12 Enfield £1,268
18 79 Swindon £681
19 62 Luton £754
20 28 Milton Keynes £873