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Buy to let property investors looking for the highest rental returns should target areas with low CO2 emissions, according to the latest research by lettings management platform, Howsy.
The research, covering 65 of the largest towns and cities based on population size, shows that when looking at areas based on the CO2 emissions per capita, there is a clear trend whereby areas home to a lower level cost more when it comes to the average rent, compared to those with much higher levels.
The lowest bracket, areas where there are 3.00-4.00 CO2 emissions per capita, which surprisingly includes London at just 3.61, are home to an average rental price of £800. This drops to £760 per month in areas with 4.01-5.00 emissions per capita, and again to £685 in the 5.01.6.00 threshold and £559 in the 6.01-7.00 threshold.
In areas with the highest level of CO2 emissions at 7.01 per capita or higher, the average rent is just £511, a 57 per cent difference when compared to the other end of the Co2 rental scale.
When looking at the 10 worst areas with the highest levels of CO2 per capita, just one is home to a higher average rent when compared to the current UK average of £953 per month – Crawley where rents average £990 per month. Though emissions in Crawley are still relatively low at 5.32 per capita.
Swansea is the worst area for a mix of poor rental returns and pollution with 22.43 tons of CO2 emitted per capita and an average rental price of just £552. Similarly, Middlesbrough, Doncaster, Warrington and Newport are home to high levels of CO2 emissions and below average rental prices.
Founder and CEO of Howsy, Calum Brannan, commented: ‘As a landlord, looking to less polluted areas seems to provide the best rental income when it comes to a buy to let investment and it’s interesting to see how less pollution directly correlates with higher rental prices.’