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TODAY'S OTHER NEWS

Maintaining the average BTL investment stands at 28% of annual rental income

Buy-to-let maintenance is costing private landlords up to 28% of their annual rental income, according to the latest research by Howsy. 

The letting management platform found the cost of maintaining the average buy-to-let investment across the UK currently sits at £2,313. 

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 just under a quarter - 23% - of the annual average rent of £20,364.  

The best investment location to keep maintenance costs low is currently Glasgow, requiring 13% of the average annual rental income, followed by Inverclyde, West Dunbartonshire, and Midlothian, all at 14%. 

Burnley, East Ayrshire, Belfast, and Falkirk all cost 15% maintanence, while Dundee and Clackmannanshire, both at 16%, were also among the lowest buy-to-let locations for maintenance costs.  

Landlords with properties in London can typically expect to pay the lowest maintenance costs as a proportion of the average annual rent in Tower Hamlets (20%), followed by Barking and Dagenham (21%), Newham (21%), Greenwich (23%) and Hounslows (23%).

Calum Brannan, founder and CEO of Howsy, said: “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.

However, with technology changing the face of the industry, landlords now have even more options at their disposal when it comes to keeping their investment profitable and all of their costs under one roof.

That’s the exact reason we launched Howsy Protect, as it not only guarantees rent if your tenant falls behind, but it protects against unforeseen repair costs. So rather than keep a chunk of rental income back for a worst case scenario, landlords can pay one consistent, manageable monthly cost and rest safe in the knowledge we’ve got them covered.”

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%

END

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