Rental returns 'set to grow'

News Category: Marketing

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More letting agents and landlords could be laughing off the doom and gloom associated with the economic downturn by depositing higher rental yields into their bank accounts, it has been suggested.

According to Cullen Property, an Edinburgh-based property management firm, opportunities in the residential lettings sector are prompting a growing number of enquiries from property investors.

The trend comes after research by Paragon Mortgages showed that landlords expect rental yields across their portfolios to increase to 6.3 per cent during 2009 as rent levels rise while house prices stagnate.

During 2008, the figure increased from an average of 5.7 per cent to 6.1 per cent, despite the impact of the economic crisis.

Steve Coyle, operations director at the Cullen Property, commented that rental yields have become a more important issue for investors because they have remained stable amid the impact of the credit crunch on the housing market.

"While the property market overall is still bottoming out, stronger rental returns have made property an attractive investment option," he said.

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