More evidence that non-London postcodes often bring better returns for landlords

London may be an obvious hotspot for prospective clients of a rent guarantee scheme like that of Advanced Rent (http://www.advancedrent.co.uk), but more research has emerged suggesting that it may be a better idea for them to investigate postcodes outside the capital, in Birmingham, Merseyside and Kent. Property services provider Move with Us has published data showing the parts of the UK that produce the greatest buy-to-let yields, defined as rental income as a percentage of the purchase price of the property.

The study, which examined two-bedroom properties for sale and for rent, showed that the highest yields were generally found outside Greater London, being scattered widely across regions - encouraging news for many provincial rent guarantee insurance policyholders. The capital's expensive property prices put paid to its chances of ranking well for returns, despite high rents. Instead, it is the B7 postcode in Birmingham that tops the list of the ten best-yielding postal districts in England and Wales, with a 10.6 per cent gross rental yield - narrowly beating the 10.5 per cent yield managed by the TN28 postcode in Kent. Merseyside's L14 postcode, with its 9.6 per cent gross rental yield, ranked third.

Rounding out the top ten were the B18 and EN8 postcodes in Birmingham and Hertfordshire respectively, which each recorded an 8.7 per cent gross rental yield, some distance ahead of the 7.8 per cent managed by the highest-ranking Greater London postal district, N9 Lower Edmonton. E13 Plaistow and SE2 Abbey Wood also figured in high positions in the list for Greater London, with 7.5 per cent and 7.4 per cent gross rental yields respectively, but nonetheless indicate that central London is not the place for rent indemnity policyholders to look to maximise their yields - not least as average yields in large parts of the capital are presently less than four per cent.

Chief executive officer at Move with Us, Sean King, explained that London-based holders of a landlord rent insurance policy didn't necessarily need to look too far afield for lucrative investment opportunities. Commuter belts to the west and east of the capital, for instance, command high yields, thanks to the combination that they offer to renters of the social and work opportunities of the capital with rental prices lower than those of central London. Collection of the data took place during the first half of 2013, with the gross rental yield being defined as the median annual rent divided by median asking price.

With the share of households renting from a private landlord or letting agency rising from nine per cent in 2001 to 15 per cent in 2011, according to those years' respective Censuses, there are clear opportunities across the UK for landlords choosing to receive their rent on time every month, by taking advantage of the highly rated Rent Guaranteed product of Advanced Rent (http://www.advancedrent.co.uk) - or for that matter, accessing their income before it is due by taking out our Rent In Advance policy.

Editor’s Note: Advanced Rent (http://www.advancedrent.co.uk) are represented by the search engine advertising and digital marketing specialists Jumping Spider Media. Email: info@jumpingspidermedia.co.uk or call: +44 (0)20 3070 1959 / +34 952 783 637.