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According to property specialists LSL Property Services, by the end of 2009 landlords experienced a 7.6% annual return on their investments.

It also found that the value of the average buy to let investment properties rose 3% in the year while rental income after void periods added a further 4.6%. This means in 2009, a typical landlord made a return of £12,740. This was a combination of modest capital gains of £4,831 on each property and £7,909 in rental income.

By contrast, in 2008, a typical landlord would have lost 8.8% even after allowing for rental income – David Brown, commercial director of LSL Property Services, says: “In 2009, investment returns in buy-to-let were very respectable and brave landlords who added to their portfolios will be celebrating an excellent year.”

Chris Norris, policy manager at the National Landlords Association, says: "A 7.6% annual return on investments is going to make many landlords smile as we go into 2010.

"Although rental yields may have dipped slightly during 2009, according to LSL, rent arrears were lower than the previous year and property prices are gradually climbing. It's now clear that the private-rented sector is recovering well from a period of instability."

If you want to experience these sort of rental yields but are hampered by an expensive mortgage, talk to a buy-to-let mortgage expert about getting hold of a loan tailored to your rental income so as to make you as much profit as possible.

SOURCE: LSL, NLA, 15/01/10

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