Research by lettings management platform, Howsy, has found that when it comes to rental yields surrounding the UK’s top 25 airports, just one offers a return above the UK average of 5%.
Due to the high demand for homes within a close proximity, rental markets surrounding airports have traditionally been buy-to-let hotspots. However, Howsy analysed current yields around 25 of the UK’s largest airports based on annual passenger totals and found that this is currently no longer the case.
The figures show that it’s not just flights that are grounded with the average rental yield across all 25 airports sat at just 3.7%.
Just Glasgow continues to soar where rental yields are concerned, with the average yield surrounding the airport cruising at 6.9%; some way above the UK average.
East Midlands airport came in just below the UK average at 4.9%, while Birmingham, London Southend, Aberdeen, Liverpool, London Luton and London Heathrow provided the next best yields between 4% and 4.4%.
At 2.5%, Bristol airport is home to the lowest current rental yield, followed by Humberside (2.8%) and London Stansted (2.9%).
Founder and CEO of Howsy, Calum Brannan, commented:
“While the current pandemic is causing financial turmoil for many tenants and as a result, their landlords, it’s also having an impact on buy-to-let profitability further up the chain.
Traditionally, a buy-to-let close to a major airport would be in extremely high demand but with the aviation industry taking such a hit, the latest figures show profitability has slumped.
However, the current climate does provide an abundance of opportunity for the savvy investor. Although changes will have to be made to the way we travel, when the aviation industry does bounce back, it will be a swift uplift in activity and therefore demand.
Investing now could well mean a lower initial property cost with an eye on high rental demand further down the line and this will help increase your return dramatically in the long run.”