As a landlord it is important that you invest in the right property in the right area in order to minimise your void periods and maximise your income.
According to the latest research from Paragon in association with LandlordZone, HMOs produce the best yields at 7% followed by flats at 6.1%. This is followed by bungalows, terraced houses and semi-detached houses all at 5.9%, detached houses at 5.7% and flats that were individual units at 5.1%. There 800 landlords surveyed – some with one property and others with a portfolio with several.
It appeared that the larger the landlord’s portfolio the better the yield. In fact, those with 20 properties or more had a yield of 6.7% whilst those with one property had a yield of 4.2%. this demonstrates the importance of diversifying an investment portfolio.
In terms of landlords’ experiences of how Covid had impacted their business, just over 30% reported that they had experienced problems from the pandemic, but this wasn’t exclusively due to rent arrears. Rental income had been reduced the most by those who held a larger property portfolio.
The report also showed that terraced houses were the most popular property type among landlords with all portfolio sizes. This is followed by flats and semi-detached properties.
Larger portfolios enable landlords to invest in a broader range of property types and result in the best overall yields.
Talk to us at Newton Letting if you would like advice on the best properties to invest in and the rental returns you can expect to see in and around Glasgow.