London rents hit almost double the rest of the UK

London rents hit almost double the rest of the UK

0:01 AM, 26th March 2012, About 12 years ago

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Buy to let landlords are picking up almost double the average monthly rent in London compared to property investors in the rest of the UK.

Average monthly rents in the capital are £1,212 a month, according to landlord mortgage firm BM Solutions.
That’s 69% more than the UK average of £716 and 41% higher than the second-placed South East (£858).
Wales (£474 per month) has the lowest average monthly rent, followed by the North and Yorkshire and the Humber (both £488 per month).

The lender’s research showed that the national average monthly rent increased by 4.8% overall last year.
The largest rises were in East Anglia (8.0%) and the North (6.9%).

Increases in the South East (5.8%) and Greater London (5.6%) were more modest, while Wales (0.1%) and Scotland (0.7%) hardly moved.

Yields last year were slightly lower than 2010 despite rent increases – falling 0.1% to an average 6.1%, said BM solutions.

The best yields were in the North (7.0%), North West, Yorkshire and the Humber (both 6.3%), Wales (6.0%), West Midlands and the East Midlands (both 5.9%).

Greater London (4.8%), South West (5.0%), South East (5.2%) and East Anglia (5.3%) all returned below average yields.

Phil Rickards, of BM Solutions, said: “There is a healthy demand for rental properties across the UK, which may be driven by the costs associated with buying a home.

“Average gross yields on a buy to let property have been just over 6% for the past two years, driven by growth in rental values.

“With house prices likely to remain broadly flat this year, buy to let landlords can again expect little capital gain on their investment in 2012.”

The BM Solutions findings are broadly in line with other recent buy to let market reviews. LSL Property Services, the UK’s largest chain of letting agents reckons average rents in February were £707 a month.

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