As tenant evictions increase, Hackney landlords are getting the highest return in London on investments, a London letting specialist has claimed.
According to letting specialist Edmund Cude, rising property values and “impressive rental yields” makes Hackney the most profitable borough for landlords in the capital.
Average house prices in Hackney have grown by 7.4 per cent since July 2011, the London letting agency said.
While central London boroughs are still at the top for capital growth, the rental yield, which is the ratio between the cost of acquiring the asset and the income that it generates, has increased in Hackney over the last year.
High tenant demand and the close proximity to central London makes Hackney a rental ‘hotspot’ for landlords, the firm said.
Robert Nichols, Managing Director at Edmund Cude said that steep house prices in central London are forcing prospective buyers and tenants to look at ‘secondary’ neighbourhoods and that: “As a consequence, these boroughs are experiencing positive capital growth and strong yields year-on-year.”
Nathaniel Mathews, senior solicitor at Hackney Community Law Centre, which helps local residents with legal issues, such as housing, said the increased popularity of the area and a prosperous climate for landlords could have a negative impact for local tenants.
Last week EastLondonLines reported on an increase in illegal evictions in Hackney rising from landlords finding ways to make higher profit and unwillingness to accept tenants on housing benefits. HCLW said illegal evictions had doubled in Hackney over the last year, warning of an “emerging social problem”.
While Mathews said reasons for evictions vary, rising values in property letting often make it difficult for residents who struggle financially.
Speaking to EastLondonLines he said: “This statement confirms what we have been seeing how difficult it is for people who are relying on benefits to rent in Hackney.
It seems to suggest that landlords can get a property relatively cheap and let it out with a relatively high rent, which makes is a problematic situation for some tenants.”
HCLW will be arranging a workshop for tenants on their rights and illegal evictions at Thursday 11 October. For more information go here.