Cardiff’s CF24 postcode has taken the top spot in Paragon Bank’s top 10 hotspots for BTL investment in 2024.
The list has been compiled based on the lender’s rating data and ranks areas in terms of popularity among landlords.
This postcode includes Cathays and Roath which are both popular areas for student rentals.
Last year, properties in CF24 generated an average weighted rental yield of 8.7%.
The second most popular postcode was B29 in Birmingham with average weighted rental yield of 7.5%.
This postcode includes the affluent areas of Bourneville and Edgbaston, as well as the Selly Oak district which contains the University of Birmingham and Queen Elizabeth Hospital.
The PL4 postcode in Plymouth was the third most popular and, similar to Cardiff and Birmingham, appeals to a wide range of tenant types including students.
Here, the average weighted rental yield is 9.6%. This is the second highest in total, behind the L15 postcode in Liverpool where BTL properties can generate 9.9%.
With the exception of Nottingham’s NG3 postcode - where converted flats were the most commonly purchased BTL property - the analysis found terrace houses were the preferred property type in all other hotspots.
“Even though privately rented homes are in short supply all over the UK, landlords are strategic and often target locations with consistently high demand; cities where we see large transient populations, such as students and temporary workers, alongside more permanent residents like young professionals and families,” said Neil Smith, head of surveyors at Paragon Bank.
“There is also a notable propensity amongst buy-to-let landlords to invest in property types that can deliver strong yields, often terraced houses and HMOs.”
