London’s competitive housing market occupies a unique position in the country’s real estate landscape, with significant benefits to landlords and potential tenants alike. Since April 2016, landlords have had to bear an additional 3 percent in stamp duty when they invest in rental property. However, long-term ownership and letting shows profitable rental yields in a metropolis that is going through a period of demand for high-quality housing, with the influx of a young workforce and renovation of its residential neighbourhoods.
Once an ecclesiastical centre, Battersea was home to vast farmlands and, later, factories. Today, the inner-city south London district is at the heart of a resurgent housing trend, featuring access to some of the city’s popular nightclubs, restaurants, and public spaces. A rising demographic of young professionals, access to excellent maintenance services, and a rising rental return of 4% make Battersea a great location to invest in housing.
Ealing’s transformation as a commercial hub and a bustling retail and hospitality centre makes it one of the most attractive rental areas in the city. With a rich history as a commercial and film production district, this west London borough is home to several musical festivals and a vibrant Polish community. Expected rental returns stand at approximately 6%, making the area ripe for investment in buy-to-let and renting properties.
The south London borough of Southwark offers easy access to nearly every iconic London monument and cultural hotspot. Rental and flat sharing returns in the area have been on the rise to approximately 6%, owing to a resurgence in the nearby financial, publishing, professional services and industrial firms in the vicinity and the consequent influx of professionals to the area.
Canonbury has experienced a revival in the years following the 2008 housing market crash, with letting returns of 5.9%. With easy access to the rest of the city from its renovated railway station, Canonbury’s reputation as a relaxing escape from London’s bustle makes it an ideal investment for landlords who enjoy peace and profitability in equal measure.
As the rental returns in London begin to rise, long-term investments in rental properties are expected to be greatly profitable to new investors in the region.