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Buy-to-let maintenance is costing UK landlords 28% of their annual rental income – here’s where to buy to beat it

Buy-to-let maintenance is costing UK landlords 28% of their annual rental income – here’s where to buy to beat it

Our research has found the cost of maintaining the average buy-to-let investment across the UK currently sits at £2,313, accounting for 28% of the annual rental income available. 

Once you’ve purchased your buy-to-let, paid the additional stamp duty and tax requirements, been hit with a lower deposit due to the Tenant Fee Act and paid a local agent’s fees to find you a tenant, you’re ready to rent right? 

Wrong. A buy-to-let investment requires constant upkeep to not only keep your tenant happy, but to ensure your investment remains in line with the legal standards required. 

Like it or not, this maintenance is a vital part of owning a buy-to-let property and Howsy has highlighted the annual upkeep cost based on the 1% rule, whereby budgeting 1% of the purchase price of a property covers the upkeep on an annual basis. Howsy then looked at the current average rent across the market and what proportion of rent is required to cover these maintenance costs and how it differs regionally. 

Of course, different property costs and rents achieved across the UK means that this cost varies regionally and doesn’t have to hit the 28% seen at a top-level across the UK. 

Nationally and Regionally

Wales is home to the highest proportion of rental income spent maintaining a buy-to-let with 1% of the average property price (£1,639) accounting for 27% of the average annual rent (£6,182), while Scotland is home to the lowest top-line level of maintenance costs at 17%. 

On a regional basis, the East of England is home to the most expensive buy-to-let investment where upkeep is concerned, with this cost accounting for 28% of the average annual rental income. The North East is the most affordable at 20% and perhaps surprisingly, London is the home to the fourth-lowest buy-to-let maintenance costs, accounting for 23% of the annual average rent of £20,364. 

Locally

The best investment location to keep maintenance costs low is currently Glasgow, requiring just 13% of the average annual rental income (£10,596) to budget for any unforeseen costs. 

Inverclyde (14%), West Dunbartonshire (14%), Midlothian (14%), Burnley (15%), East Ayrshire (15%), Belfast (15%), Falkirk (15%), Dundee (16%) and Clackmannanshire (16%) were also amongst the lowest buy-to-let locations for maintenance costs. 

In London, Tower Hamlets (20%), Barking and Dagenham (21%), Newham (21%), Greenwich (23%) and Hounslows (23%( were the boroughs home to the lowest buy-to-let maintenance costs as a proportion of the average annual rent. 

Covering maintenance costs is an essential part of managing your buy-to-let investment as failing to do so will not only reduce the profitability of your investment as tenants look elsewhere, but it can also land you in hot water legally if your property is not fit for purpose. 

Using the one per cent threshold of the purchase price of your property is a sensible place to start when budgeting for maintenance and although it acts as a rough rule of thumb, it should cover everything but the very worst damage to your property. 

Of course, the government’s consistent attack on the profitability of the buy-to-let sector could have alternative consequences as landlords cut corners on maintenance to get by, but as our research shows, this doesn’t have to be the case.

The UK rental sector is a vast and varied one and investing in the right property, in the right place, will see operating costs remain palatable and profits remain robust.

Primary level – nations
Location Average Annual Rental Estimated annual maintenance Average house price Maintenance as a proportion of rent %
England £10,224 £2,474 £247,426 24%
Wales £6,182 £1,639 £163,936 27%
Scotland £8,982 £1,519 £151,945 17%
Northern Ireland £7,524 £1,379 £137,872 18%
United Kingdom £8,232 £2,313 £231,265 28%
Secondary level – English regions
Location Average Annual Rental Estimated annual maintenance Average house price Maintenance as a proportion of rent %
East of England £10,428 £2,908 £290,836 28%
South East £11,976 £3,225 £322,532 27%
South West £9,792 £2,566 £256,553 26%
East Midlands £7,536 £1,936 £193,560 26%
West Midlands £7,944 £1,987 £198,659 25%
London £20,364 £4,719 £471,948 23%
North West £7,452 £1,648 £164,822 22%
Yorkshire and The Humber £7,404 £1,635 £163,541 22%
North East £6,396 £1,289 £128,932 20%
Ranking – by lowest maintenance cost as a proportion of rent gained
Location Average Annual Rental Estimated annual maintenance Average house price Maintenance as a proportion of rent %
City of Glasgow £10,596 £1,335 £133,453 13%
Inverclyde £7,476 £1,033 £103,268 14%
West Dunbartonshire £7,559 £1,052 £105,181 14%
Midlothian £13,008 £1,874 £187,380 14%
Burnley £5,544 £840 £84,029 15%
East Ayrshire £6,336 £962 £96,233 15%
Belfast £8,592 £1,312 £131,161 15%
Falkirk £8,124 £1,245 £124,517 15%
City of Dundee £7,920 £1,241 £124,076 16%
Clackmannanshire £8,124 £1,298 £129,835 16%
Ranking – by highest maintenance cost as a proportion of rent gained
Location Average Annual Rental Estimated annual maintenance Average house price Maintenance as a proportion of rent %
Monmouthshire £7,688 £2,722 £272,203 35%
Kensington And Chelsea £36,636 £12,555 £1,255,549 34%
Powys £5,540 £1,870 £187,006 34%
Suffolk Coastal £8,556 £2,873 £287,323 34%
Cotswold £11,472 £3,843 £384,342 34%
Charnwood £6,672 £2,230 £223,000 33%
Bromsgrove £8,808 £2,931 £293,123 33%
South Hams £9,312 £3,072 £307,217 33%
Folkestone and Hythe £7,740 £2,552 £255,250 33%
South Bucks £18,108 £5,943 £594,326 33%
Tertiary level – London boroughs
Location Estimated annual maintenance Maintenance as a proportion of rent %
Kensington And Chelsea £36,636 £12,555 £1,255,549 34%
Haringey £18,696 £5,482 £548,162 29%
Richmond upon Thames £22,284 £6,532 £653,201 29%
Kingston upon Thames £16,680 £4,887 £488,667 29%
Hammersmith and Fulham £25,404 £7,238 £723,807 28%
Barnet £18,276 £5,205 £520,535 28%
Merton £18,360 £5,095 £509,472 28%
Camden £30,432 £8,434 £843,449 28%
Bromley £15,852 £4,377 £437,728 28%
Islington £22,968 £6,324 £632,427 28%
Waltham Forest £15,708 £4,318 £431,770 27%
Ealing £17,556 £4,749 £474,948 27%
Croydon £13,632 £3,649 £364,882 27%
Hillingdon £15,240 £4,074 £407,373 27%
City of London £29,352 £7,845 £784,538 27%
Sutton £14,004 £3,736 £373,634 27%
Harrow £16,884 £4,500 £450,028 27%
City of Westminster £36,216 £9,512 £951,242 26%
Brent £18,420 £4,830 £483,037 26%
Redbridge £15,816 £4,134 £413,432 26%
Havering £14,028 £3,646 £364,579 26%
Wandsworth £22,596 £5,851 £585,086 26%
Lewisham £15,888 £4,094 £409,373 26%
Bexley £13,272 £3,377 £337,693 25%
Hackney £22,008 £5,599 £559,942 25%
Southwark £19,848 £4,970 £497,016 25%
Enfield £15,720 £3,934 £393,381 25%
Lambeth £21,048 £5,076 £507,586 24%
Hounslow £17,184 £4,010 £401,045 23%
Greenwich £16,848 £3,911 £391,097 23%
Newham £17,088 £3,632 £363,240 21%
Barking and Dagenham £14,328 £3,002 £300,242 21%
Tower Hamlets £21,636 £4,354 £435,411 20%

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