Canary Wharf tops the London Marathon route

The latest insight from property management specialist Rushbrook & Rathbone has found that E14 is the strongest postcode along the London Marathon route for landlords looking to invest in the capital’s rental market, delivering an estimated average yield of 6.6%.

Rushbrook & Rathbone analysed current asking house prices and rents across postcode districts spanning the London Marathon route, calculating the estimated gross rental yield available to landlords in each area.

The analysis shows that E14, which covers a large section of the route from mile 15 through to mile 21, offers the strongest return for landlords, with this stretch of the marathon including areas such as Canary Wharf, the Isle of Dogs and Poplar.

Across the postcode, the average asking house price currently stands at £475,000, whilst the average monthly rent is £2,600, resulting in an estimated yield of 6.6%.

The second strongest investment locations along the route are SE16 and E1.

The SE16 postcode spans Canada Water, Surrey Quays and Rotherhithe between miles nine and 11, with an estimated yield of 5.8%.

E1, covering St Katherine Dock, Limehouse and Shadwell between miles 13, 14 and 22, also delivers an estimated yield of 5.8%, whilst SE18, covering Charlton and Woolwich at miles two and three, ranks close behind at 5.6%.

At the other end of the scale, some of the most prestigious and expensive locations along the route offer considerably weaker returns. WC2, which covers Embankment at mile 25, offers the lowest estimated yield at 3.7%, despite average monthly rents of £4,000. This is due to significantly higher purchase prices, with the average property valued at £1.31m.

Similarly, EC3, covering Tower Hill, delivers a yield of 4.3%, whilst SW1, covering St James’s and the finish line at The Mall, delivers 4.8%.

 

Roma Sharma, Managing Director of Rushbrook & Rathbone, commented:

“Whilst many landlords are naturally drawn to London’s best-known and most prestigious locations, the strongest rental returns are often found elsewhere.

What the marathon route demonstrates is that areas such as Canary Wharf, the Isle of Dogs, Canada Water and Limehouse currently provide a far stronger balance between purchase price and rental income than more expensive prime central London postcodes.

Of course, yield is only one part of the investment picture. Landlords should also consider tenant demand, long-term capital growth, ongoing management costs and the quality of the local rental market.

However, for those looking to maximise their rental return, the strongest opportunities are often found a little further away from the finish line.”

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