If you thought the coastline of Britain mainly provided opportunities for investment in holiday lets, research from the Halifax shows that the seaside could offer a great deal more to the buy-to-let market. Their findings show that during the last ten years the price of houses has on average increased by 63% in British seaside towns; typically homes there are now worth close to £200,000. This offers buy-to-let landlords wishing to boost their finances for retirement a very attractive opening.

Seaside for great Buy to Let returns

Seaside for great Buy to Let returns

Rising coastal property prices

It is perhaps not surprising that house prices are higher along the coast, with coastal living offering pleasant surroundings and a better quality of life. However, the north-south divide, which typically favours homes in terms of price weighting in the south, does not seem to be come into play when it involves properties on the coast. While Salcombe and Sandbanks lead as the most expensive locations, it isn’t just those in southern England that have fared well, as 80% of seaside resorts seeing the greatest price rises are located elsewhere. For instance, the Welsh coastal town of Porthmadog has seen the greatest rise in property prices since 2003, standing at 134%. Seaham in County Durham and Newbiggen-by-the-Sea in Northumberland have also experienced impressive gains, with the value of property increasing by 128% and 120% respectively.

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High coastal yields

Property in seaside locations and cities with ports can offer buy-to-let landlords opportunities for high yield investment, with Blackpool currently standing as the second best place in which to purchase property to rent out in the UK. According to HSBC, yields there at present are 7.81%; Kingston-upon-Hull offers similar returns, as does Southampton for landlords looking to invest in property along the south coast. Further east Bournemouth doesn’t offer quite the same returns owing to the rental income that can be achieved in relation to the house prices there, but at 5.81% is still a tempting offer.

Good returns elsewhere

However, it isn’t just coastal areas offering good investment opportunities for landlords; Manchester, Nottingham and Slough offer yields as follows – 7.6%, 7.55% and 6.82%. Here affordable property goes hand in hand with comparatively high rents thanks to low unemployment, good schools and universities locally. London cannot currently compete, offering only modest rental yields in many areas due to its high prices; while Southwark can offer investors just over 6%, in Chelsea and Kensington this is only around 3%.