Research from LendInvest has named Sunderland as the top postcode area for landlords letting properties to students.
In its latest Buy-to-Let Index, LendInvest looked specifically at 2016 average rental yields – the most important factor for landlords letting to students – in postcode areas with at least one of England and Wales’s top universities that feature on the latest league table compiled by the Complete University Guide (CUG).
Christian Faes, co-founder and chief executive of LendInvest, said: “Student towns are an excellent option for investors; there’s a steady stream of demand with each new academic year delivering prospective tenants.
“With A-level results out today and the year’s clearing for university places swinging into action, where’s best for student lets will be on the minds of many landlords.
“However landlords need to look beyond simply how big the local student population is.
“For instance, there are many thousands of students attending universities in London, yet when it comes to rental yields there are far more profitable areas to invest in than the capital.”
Based on figures for 2016, property investors who invest in properties in Sunderland can enjoy average rental yields of 6.50%. Sunderland is also the cheapest place to invest in in the top 20 student towns, with the average property price standing at just £90,000.
The next best area is Manchester, with an average rental yield of 6.2%. Investors here can benefit from significant demand – the city is home to three ranked universities and a student population of nearly 90,000 people. Average property prices in Manchester stand at £135,000.
Cambridge may be ranked as the nation’s top university, but Oxford offers investors a better return. The average rental yield in Oxford stands at 3.9%, compared to 3.6% in Cambridge.