Earlier this year HSBC named this south coast port city as the number one buy-to-let hotspot in England and Wales, with average rental yields coming in at an impressive 7.82pc.
Of 50 towns and cities with the highest concentration of private rental stock Southampton’s combination of average property prices of just over £138,000 and average rents of just over £900pcm propelled it to top of the bank’s league table.
Helen Asteris, Savills’ head of residential development sales in the city, recommends that investors target one or two-bedroom flats, ideally with outside space, in city centre locations, close to the station and university campuses.
Buyers should budget between £175,000 and £250,000 for a one-bedroom flat, which would rent at about £900pcm, or £240,000 to £350,000 for a two-bedroom flat, which would rent for between £1,250 to £1,500pcm.
“There is lots of interest from young professionals, recently employed graduates, couples and singles, key worker staff, plus professional sharers where there are two double bedrooms and two bathrooms,” said Ms Asteris.
House prices in Southampton slipped 1.5pc during the past year, according to the latest UK House Price Index, but the slightly down-at-heel city centre is poised to rebound with projects like Southampton Airport’s recently-completed runway extension and regeneration schemes like Packaged Living’s £200m regeneration plans for a site near the station, including 600 homes, plus shops, restaurants and leisure venues.
