London landlords have pocketed the largest gains when selling buy to let property last year, according to the latest data from property firm Hamptons International.
Property investors in the capital made three times as much as landlords in England and Wales, with average gains of £248,000. Across the rest of the country, the average gain was £80,000.
The firm’s head of research Aneisha Beveridge explained that while 85 per cent of property investors sold their rental homes for a profit after owning them for an average 9.6 years, 15 per cent – one in six – sold at a loss.
Many of these landlords owned buy to let homes in the North-East, the region returning the lowest gains.
Landlords in the North-East saw average gains of £11,810 with 56 per cent selling for a profit.
The largest gains seen were in London, specifically in Kensington and Chelsea (£1.07 million).
Landlords in South Buckinghamshire picked up the biggest profits outside the capital at an average £278,310.
“The average landlord who sold their buy-to-let last year did so for nearly £80,000 more than they paid for it. Over the 9.6 years that the average landlord has owned their buy-to-let, house price growth has driven their gains, with prices having risen around 30 per cent over the period.” said Beveridge.
“But given lower expected future house price growth and tighter mortgage regulation, more investors are shifting their focus from capital gains to yields.”
Despite the large investment gains on London rental homes, separate research from Hamptons International reveal 59 per cent of London property investors purchase buy to let homes outside the capital.
The firm cites an average £24,600 stamp duty bill on London rental homes as the trigger leading London landlords to look elsewhere to invest. Outside London, the average stamp duty bill for a rental home is £5,330.