Buy To Lets
Property in Leeds varies in value from around £75,000-£750,000, with the average property value currently being close to £170,000.
The safe buy to let range is generally considered to be in the region of £100,000-£200,000.
Where we source you a buy to let, our aim is to achieve a good balance between yield and capital growth for you. This will also depend on your requirements and your goals.
Some investors prefer to go more for yield. This may be because they need the income now or use it to build up deposits to buy more assets. They may also rightly think that yield is predictable, whereas capital growth is not.
Others prefer long term capital growth. They may not need the income now, or they are looking to minimise their current tax liability. They may also view their property investment more as a retirement vehicle.
We’ll work with you to find your ideal purchase based on your individual requirements.
In many cases we go for a balance of yield and growth – a sweet spot in the middle – to minimise your risk.
In this range you can expect to achieve the following numbers on buy to lets in Leeds, assuming a 75% Loan to Value (LTV) interest only mortgage at 4% interest:
• Gross Yield: 5-7%
• Net ROI on cash invested: 5-7% (after all costs have been accounted for)
• Average cash flow (monthly profit): £100-200pcm (after all costs have been accounted for)
In most parts of Leeds you can expect high levels of tenant demand year round (except the Christmas period) for 1-3 bedroom homes. The quality of the property and its location is reflected in the rental price and also often in the standard of tenant that the property attracts.
Remember also to factor in capital growth. Whilst this varies every year, in the last 20 years in our area (we looked at LS4, LS5, and LS6 here) we have seen average capital growth of 9.5% per annum.
Adding your yield to the capital growth often gives a combined return of around 15% per annum.