New research by Revolution Brokers has revealed which Crossrail stations currently make the best investment for buy-to-let landlords based on the average rental yield available in each station postcode.
Revolution Brokers analysed current rental and housing market data to find the average rental yield in each Crossrail station postcode, as well as looking at how this has changed when compared to the previous year.
The research shows that, on average, a buy-to-let investment within a Crossrail postcode will return a yield of 3.7%, with this average profit margin increasing from 3.4% a year ago.
But where’s best to invest?
Current Crossrail rental yields
At 5.1%, Reading’s RG1 postcode currently ranks as the strongest area for a Crossrail buy-to-let investment. However, East London is also home to some of the strongest yields available along the Elizabeth line.
The E16 postcode, home to the Custom House Crossrail station, is currently home to an average rental yield of 4.9%. A little further down the line, the E15 postcode is home to both the Maryland and Stratford stations, as well as a very respectable average rental yield of 4.8%.
Southall also boasts a current average rental yield of 4.8%, while Forest Gate and Canary Wharf rank high at 4.5%.
Other stations to make the top 10 best buy-to-let investments along the Elizabeth line at present include Whitechapel (4.4%), Woolwich (4.3%), Abbey Wood (4.3%), West Drayton (4.3%) and Manor Park (4.3%).
In contrast, the average yield is currently just 1.9% in the W1 postcode, home to the Tottenham Court Road and Bond Street Crossrail stations.
Rental yield growth
Custom House and Forest Gate not only boast some of the highest average rental yields, but at 0.8%, they’ve seen the largest annual increases across the entire network.
Reading, Southall, Canary Wharf and Whitechapel have also seen some of the strongest growth, up 0.7% in the last year.
Twyford has seen the largest annual decline in the average rental yield at -0.6%, while Chadwell Heath, Romford, Harold Wood, Langley, Goodmayes and Seven Kings have seen a decline, albeit to a more marginal extent.
Founding director of Revolution Brokers, Almas Uddin, commented: “Crossrail is one of the most significant developments to travel infrastructure within London and the South East in many years, so it’s hardly surprising that homebuyers and tenants alike are flocking to areas with direct access to the Elizabeth line.
"This heightened demand for rental properties, in particular, presents a great opportunity for buy-to-let investors, as demand for Crossrail rental homes is only going to grow now that the service is finally starting to run.
"Of course, property values along the route have already climbed significantly and so it’s important to find the right balance between this initial cost and the rental income available to ensure a good return on your investment.
"The good news is that despite this strong market growth, there remains a wealth of stations offering a very respectable rental yield and so now is as good a time as any to invest.”