Liverpool Short-Term Lets offering yields of up to 27.2%

Many investors are adding Liverpool buy-to-let to their portfolio given the high rental returns, strong local economy, significant regeneration and excellent growth forecast. This can be further enhanced by using the short-lets model, which is providing even stronger returns for Liverpool’s landlords.

Buy-to-let landlords who own property in Liverpool could potentially achieve short-term rental yields of just over 27%, according to Portico Host interviewed by Landlord Today. However, the highest yielding locations may just surprise you.

“The short-term letting agency has conducted research on short-term lets in Liverpool and Manchester and found that landlords in Fairfield, Liverpool, are achieving the best short-term let yields at 27.2%, compared to landlords of longer-term rentals, who can achieve a yield of 13.6% in the same area.

Of the ten best performing locations for short term let yields, the top eight are in Liverpool postcodes: L6, L4 and L7. In Manchester, the highest short let yields can be found in Hulme (M15) at 15.1%.

The strengthening of its economy and infrastructure, along with its growing student and young professional population, and lower property prices, make investment in places such as Fairfield, Kensington, Walton and Anfield a popular choice for investors.”

It’s not only the rental returns in its favour, the North West is also forecast to benefit from the highest property growth of any region in the UK over the next 5 years, exceeding 24% in that period according to Savills, in no small part thanks to the billions invested into regeneration. The combination of strong rental yields and growth make this a lucrative option for the savvy investor.

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What are Short-term lets?

What we are referring to in this case is residential property, but with the ability (without restrictions) to let the property as short-term lets. STL’s are a way to achieve considerably higher rental income in comparison to renting a property using the more traditional assured shorthold tenancy (AST). Letting on a nightly or weekly rate, adjusting the cost per night according to local events such as a concert, sporting event, or seminar, the nightly rate can be increased to the added demand, in the same way a hotel does.

Apartments being typically larger than hotel rooms, with kitchen facilities mean more of a homely, comfortable stay. Whether it be a corporate let, families or friends, a well-located development will cater to both the leisure and corporate market.

The investment potential for savvy investors in this sector is undeniable. The returns generated from a serviced apartment let on a short term basis far outweigh those of a traditional buy-to-let purchase in the same location.

No doubt you’re thinking, surely this will mean a huge increase in workload for me as a landlord? The good news is that there are many specialist operators working in this sector, who will manage the daily tasks for you. Management fees are slightly higher than the traditional AST model, given the additional work; however, the enhanced returns from short-lets far outweigh this slight increase in management cost.

The UK has seen huge growth in the short-term lettings sector over the past five years, particularly in major cities such as London, Manchester, Liverpool and Edinburgh. When the effects of COVID-19 settle and the leisure and tourism industries are back to a level of normality, we can expect the demand to return. 2019 saw Liverpool’s highest every recording nightly stays, breaking 2 million for the first time.

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Benefits of short term lets

• Potential to earn double the income compared to long term tenancies
• Achieve the same level of income with a much lower occupancy level
• Less wear and tear on furniture
• Block days out for personal usage

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Short term lets - Liverpool:

• £2,563 = Average monthly income for short term let owners in Liverpool
• £99 Average nightly rate
• £5.5m visitors to Liverpool in 2019
• Over 2 million keys (nightly stays) were recorded in 2019
• Fully managed by professionals

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What Short term let Investment opportunities are available in Liverpool?

We have three popular choices location within Liverpool that are suitable for short term lets, providing studio, 1 & 2 bedroom apartments in close proximity to the City Centre, are Bishop Square, 19 Keel Wharf & St. Anne’s Gardens.

Prices start from as little as £86,000, with expected returns exceeding 15%, or up to 10% net.

For further information click the markers below or visit the listings pages.

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