Fresh research underlines the past, present and future potential of buy-to-let property investments

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RESEARCH published this week has again reinforced the expert view that property remains a solid, long-term investment.


Commentators said that against a backdrop of appallingly-low returns from banks and building societies, savers were still turning to residential property as a means of supplementing their income.

And with historically low mortgage rates, wedded to high demand from tenants and increasing rents, they predicted that the appetite for buy-to-let would continue to gather pace.

The research comes at the same time as another separate set of positive figures revealed that university towns in the North of England were outperforming the South in terms of topping the league table for returns on property investment.

And the experience of our buy-to-let investors bears this out.

Our own research shows that buy-to-let investors in both Leeds and York, for example, are benefiting from an average annual yield of 5.9% and 4.5%* respectively - a trend mirrored across the whole of our 11-branch network in North and West Yorkshire.

*Average yield taken from our current buy to let properties available for sale

What’s more, this does not take into account additional capital growth

Linley & Simpson endorses the view that the secret to successful property investing is ultimately the same now as it ever was. The market consistently rewards those who stay level-headed, diversify portfolios - and work with us to research the right home in the right in-demand area at the right price.

The main study, commissioned by property investment platform British Pearl, revealed that those who had invested in residential property were in profit 83% of the time, on average, over the past 50 years.

It also found that average house price growth was 58.6% between April 1968 and April 2018, on properties held for five years.

Property prices only fell in five periods, representing an 89.1% success rate.

British Pearl then factored in stamp duty and conservative estimates for mortgage payments, legal fees and interest. This then identified a further three years in which investors who bought properties would have lost money over the following five – still highlighting a success rate of 82.6%.

The best profit would have been enjoyed by the average landlord buying in 1969, resulting in a gain of £4,589 - a return of 148.6%.

James Newbery, investment manager at British Pearl, commented: “History shows us that investors who are prepared to weather storms rather than run for cover are still able to make strong returns at times from investments that present a very limited risk of loss.

"While our analysis shows housing has been a solid investment over time, we know that returns can be bolstered with careful property selection, identifying regional trends and areas of rental yield strength.

"The message, not just for investors but homeowners, too, is to play the long game. UK property has a track record of returns and, no matter how tempting it is to think prices are unsustainable, the level of demand for housing in Britain makes property one of the most attractive asset classes on an ongoing basis."


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