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Airbnb Investment All About Airbnb

Investing in Property for Sale: How to Buy A Profitable Property for Airbnb in Leeds City Centre

airbnb property for sale Leeds City Centre

airbnb property for sale Leeds City Centre

The Leeds City Centre in the UK is filled with vibrant and innovative art galleries. Residents of Leeds in West Yorkshire are known for their local pride. This city boasts its wealth of amenities, great schools, five universities and an unrivaled arts scene. Leeds is rapidly becoming one of the UK’s most sought-after city locations – which is a great sign for property investment!

Are you looking to invest in a property where you can maximize profitability in a particular region? If yes, then it’s certainly a must to consider the major things to look out for when buying a property for Airbnb. While rental arbitrage in Leeds is fairly popular and does not require you to purchase a property, it’s still best to learn about buying a property for Airbnb and making sure it’s profitable.

Aside from a property’s fascinating architectural design, proximity to major tourist areas, and accessibility to the best go-to places, the primary step is to determine profitability. It’s also good to know that Airbnb rules in Leeds are not too strict. In this article, we’ll discuss the metrics in order to gauge the best property investment, specifically when buying a property investment in the UK. 

This includes the best website recommendations for property investment, defining property gross rental yield, cash-on-cash return, and annual revenue, along with some of the most ideal and profitable properties according to their location. 

Is Property Investment Profitable in Leeds City Centre?

Since the UK has the fastest-growing property markets across the globe, there is a wide variety of profitable property investments offering higher yields. Using a short-term rental calculator, it was discovered that a 3-bedroom apartment in Leeds City Centre can generate an annual revenue of £33,030 with a steady occupancy rate of 72% and a nightly rate of £129.

airbnb property for sale Leeds City Centre

airbnb property for sale Leeds City Centre

Profitable Properties for Sale in Leeds City Centre

Finding the best properties that have the potential to produce high yields and capital growth are certainly some of the preferences of major investors. It’s always best to ask for assistance from real estate agents to access exclusive and unique properties during the development stage. 

At the same time, it’s even better when a property investor like you conducts research about predicted growths and market forecasts. Here are some of the profitable properties in Leeds City Centre along with the calculated gross rental yield, cash-on-cash return, and annual revenue:

airbnb property for sale Leeds City Centre
airbnb property for sale Leeds City Centre

Leylands Road, Leeds LS2

1. Studio-type Property for Sale Leeds
0.8 miles to Leeds

Asking Price: £40,000

GROSS RENTAL YIELD 27.73%
ANNUAL REVENUE £11,092
CASH ON CASH RETURN 57.42%
airbnb property for sale Leeds City Centre
airbnb property for sale Leeds City Centre

  Bedford Street, Leeds LS1

2. 1-Bedroom Property for Sale Leeds
1.5 miles to Burley Park

Asking Price: £90,000

GROSS RENTAL YIELD 24.48%
ANNUAL REVENUE £22,029
CASH ON CASH RETURN 47.66%
airbnb property for sale Leeds City Centre
2-Bedroom Leeds

 Seaforth Place, Leeds LS9

3. 2-Bedroom Property for Sale Leeds
2.5 miles to Cross Gates

Asking Price: £125,000

GROSS RENTAL YIELD 24.90%
ANNUAL REVENUE £31,130
CASH ON CASH RETURN 48.94%
3-Bedroom Leeds
3-Bedroom Leeds

Ganners Road, Moorside, Leeds LS13

4. 3-Bedroom Property for Sale Leeds
0.6 miles to Kirkstall Forge

Asking Price: £90,000

GROSS RENTAL YIELD 24.15%
ANNUAL REVENUE £21,736
CASH ON CASH RETURN 46.69%
4-Bedroom Leeds
4-Bedroom Leeds

 Market Street, Thornton, Bradford BD13

5. 4-Bedroom Property for Sale Leeds
3.9 Miles to Frizinghall

Asking Price: £100,000

GROSS RENTAL YIELD 24.41%
ANNUAL REVENUE £24,414
CASH ON CASH RETURN 47.47%

Conclusion

Since Airbnb is rapidly increasing and constantly changing for each city in the world, it is crucial to make decisions based on wild guesses. The data points mentioned in this article for Leeds such as Airbnb occupancy rates, annual revenue, and average daily rate should be the primary basis before investing in a property. 

Hence, if the data presented above has given you ideas to boost your strategic pricing plan for your business, then an Airbnb rental arbitrage calculator is certainly what you need for success in the long run. It’s a fact that some of the STR investors are also considering Airbnb Rental Arbitrage, but they still need to have a reliable data tool on to base their conclusions! 

As we live in a digital era, an accurate data analytics tool can help your business stand out among your surrounding competitors and benchmark your property by tracking the occupancy rates of competing listings in your preferred city.

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Airbnb Rental Arbitrage All About Airbnb

Airbnb Rental Arbitrage in Leeds

Leeds airbnb rental arbitrage

Are you interested in achieving financial independence through passive income? Here’s a disclaimer: you don’t need to own a property to start the Airbnb rental arbitrage business! In this article, we featured the entire process of Airbnb rental arbitrage in Leeds, its profitability, and the best areas and neighborhoods. Continue reading to learn more about short-term regulations and ways to convince landlords to sublet properties for rental arbitrage!

What is Rental Arbitrage? 

Rental Arbitrage is a way to start an Airbnb business with no money. By convincing landlords to lease you a property, you can furnish and sublease it on Airbnb and VRBO. No need for you to buy a property! 

It is perfectly legal and is a proven scalable business model. In my podcast, I have spoken to various entrepreneurs doing Airbnb arbitrage full-time. 

Here’s a proof! In Leeds, Rhifa manages 21 listings and I’m pretty sure she doesn’t own all the properties. She made £376,344 in the last 12 months.  

rental properties in leeds

How much can I make with rental arbitrage in Leeds?

Before you dive in and start putting out your hard-earned money on a property, it’s important to know how much profit you can make. For instance, the best neighborhood to invest in is Leeds City Centre, located in the LS1 district which has an average yield of 5.97% in Leeds. 

Since this neighborhood is situated in the inner-city, business professionals and students are mostly within this area. Therefore, boosting rental demand and yields!

Leeds airbnb rental arbitrage
Profit & Monthly Expense in Leeds

Based on Airbtics’ data, you can earn a whopping £2,128 per month for a 3-bedroom apartment in Leeds City Centre alone. With the data provided, you can certainly tell that investing in a property in Leeds is profitable!

Average Rent Price Airbnb Monthly Revenue Monthly Expense Monthly Profit
£1,230 £2,128 £425 £472

Source: Airbtics dashboard

The monthly profit can be calculated by subtracting the Airbnb monthly revenue, the rental price and monthly expense (£2,128-£1,230-£425 = £472).

 Startup Cost in Leeds

Now that you have an overview of how much your monthly expense & revenue, let’s talk about the start-up cost! How long does it take for an investor to get back the startup cost? Let’s take a look at this calculation:

Total Startup Cost (Average startup cost + 2 months rent price) Cash Return Time
£4,460 9 months

The average estimated startup cost (for furnishing) in Leeds is around £2,000. To compute the total startup cost, it is necessary to add the 2 months of average rent price (£2,460). Now that we have a total startup cost of £4,460, cash return time can be calculated by dividing this by the monthly profit (£472).

Given your monthly revenue of £472, it will take approximately 9 months time to get back the startup cost! In such a short period of time, you can already expect profit and consider starting your second unit for rental arbitrage. If this sounds promising to you, then go ahead and look at the other best areas for rental arbitrage in Leeds!

Best Areas for Rental Arbitrage in Leeds

Before investing in a particular area in Leeds, you have to take a look at the top markets and number of listings to set your expectations towards success. Check out the top 3 neighbouroods in Leeds ranked by their annual revenue, along with their occupancy & daily rates!

1. Leeds City Centre (LS1)

This is the most preferred area by investors who are looking to achieve a higher monthly income. Leeds City Centre is filled with tremendous businesses and is becoming a commercialised area in Yorkshire. Here’s what you can expect in this neighbourhood:

Type of Bedrooms Average Rent Price (pcm) Average Airbnb Revenue Occupancy Rates Average Daily Rate
1-bedroom £656 £2,334 73% £120
2-bedrooms £928 £2,970 67% £167
3-bedrooms £1,230 £2,128 60% £264

According to our Airbtics Dashboard, there are more than 302 Airbnb listings with 41 private room properties and 144 one-bedroom properties in this area. The monthly revenue for most properties in Leeds City Centre is more than £1,447.06 per month with occupancy being more than 53%.

2. Armley (LS6)

This neighborhood is a popular location for Leeds property investors due to low house prices and consistent rental growth. Here’s what you can expect in this neighbourhood:

Type of Bedrooms Average Rent Price (pcm) Average Airbnb Revenue Occupancy Rates Average Daily Rate
1-bedroom £525 £910 58% £67
2-bedrooms £625 £961 65% £97
3-bedrooms £894 £1,302 45% £152

This area has a total of 37 Airbnb listings with 21 private room properties and 28 one-bedroom properties. The monthly revenue for most properties in Armley is more than £203 per month with occupancy being more than 41%.

3. Morley (LS27)

Morley is becoming one of the most popular investment hotspots in the city of Leeds because of its community feel and has shown some of the strongest growth in the UK property market. Here’s what you can expect in this neighbourhood:

Type of Bedrooms Average Rent Price (pcm) Average Airbnb Revenue Occupancy Rates Average Daily Rate
Studio Type £525 £2,527 58% £134
1-bedroom £542 £2,527 33% £67
2-bedrooms £712 £1,386 32% £90

This area has a total of 16 Airbnb listings with 4 private room properties and 8 one-bedroom properties in this area. The monthly revenue for most properties in Morley is more than £637 per month with occupancy being more than 61%.

how much can you make on airbnb

Short-term rental regulations in Leeds

To begin with, it’s certainly important to be familiar with the Airbnb rules in Leeds to make sure that your business will run smoothly. Here are some of the short-term rental regulations and laws to take note of:

  • Mandatory Licensing of Houses in Multiple Occupation (HMO)
    If the property consists of a mixture of self-contained flats and flats where the tenant has to go out of their flat usually through a communal area to make use of an amenity as described above (whether for their exclusive use or not), then this may require an HMO licence. In addition, properties let above commercial premises may require an HMO licence.
  • In order to even advertise your property, it is a legal requirement to have an EPC Energy Performance Certificates (EPC) for each property. Once an EPC is obtained, it is valid for 10 years unless the property is sold and a new EPC must be obtained at that point.
  • Employers’ liability insurance is a legal requirement if you employ anyone at your holiday home – i.e. if you have a host, housekeeper, cleaner, or gardener.
  • If you have a mortgage, your lender will require you to have building insurance.
  • If the property is leasehold, the terms and conditions might prevent short-term letting, so check your lease and speak to the freeholder.

How to Find Landlords for Airbnb Rental Arbitrage

Airbnb investment through rental arbitrage is one of the best strategies to have passive income. However, it could be a challenge to find a landlord that allows their property for subletting on Airbnb. You can also convince a landlord by following the rental arbitrage email template & be extra creative! 

Here are ways how you can find landlords that allow Airbnb rental arbitrage:

  1. Real Estate Websites

Renters in the digital world who are looking for properties online can easily connect with landlords. Some of the most recommended online real estate websites which allow you to filter by city, state, or ZIP code are:

However, you can also find apartment & condominium properties online in the following websites:

  1. Search Engines & Marketplaces

     

There are numerous property owners who are leasing their properties and you can easily find them on Google & online marketplaces. Check out some of the most recommended marketplaces:

  1. Communicate with Landlords

If you are currently renting a space or know someone who is, then it’s also recommended to speak with them. Start by asking if there are vacant rooms or properties and let them know about your intentions of putting them up for rental arbitrage. They might also be able to recommend neighbors or local friends who are also interested in this idea!

Airbtics
ANALYZE LEEDS NOW!
Categories
Airbnb Rules All About Airbnb

Airbnb Rules in Leeds

Leeds airbnb rules

If you want to start an Airbnb business in the UK, knowing the Airbnb rules in your preferred city is the first step! In this article, we featured Airbnb rules in Leeds along with short-term let policies, buy to let properties, things to consider in property investment, and more. Continue reading and learn more about the Airbnb regulations in Leeds!

Is Airbnb legal in Leeds? 

Don’t worry, Airbnb is legal in Leeds! This modern and cosmopolitan city is considered the fourth largest urban area in the United Kingdom. You can find various shopping centers in Leeds as well as many leisure activities. On top of that, the city also offers exquisite gastronomy!

Here is a little proof! As of May 2022, there are 10,558 nights available in Leeds from Airbnb alone. Miroslav manages 23 listings, Charli, and Rhifa operates 20 and 20 respectively. 

How much can I make by running an Airbnb in Leeds?

Currently, there are 534 Airbnb listings in Leeds, with 57% of entire houses earning up to £2,134 a month. The Average Occupancy Rate in Leicester is 49% and the average daily rate is £109. According to short-term rental data source Airbtics, a 2-bedroom apartment in Leeds can make up to £37,264 each year. Check out our Airbnb Calculator!

Leeds airbnb rules
Short-term rental policy in Leeds
  • Mandatory Licensing of Houses in Multiple Occupation (HMO)
    If the property consists of a mixture of self-contained flats and flats where the tenant has to go out of their flat usually through a communal area to make use of an amenity as described above (whether for their exclusive use or not), then this may require an HMO licence. In addition, properties let above commercial premises may require an HMO licence.
  • In order to even advertise your property, it is a legal requirement to have an EPC Energy Performance Certificates (EPC) for each property. Once an EPC is obtained, it is valid for 10 years unless the property is sold and a new EPC must be obtained at that point.
  • Employers’ liability insurance is a legal requirement if you employ anyone at your holiday home – i.e. if you have a host, housekeeper, cleaner, or gardener.
  • If you have a mortgage, your lender will require you to have building insurance.
  • If the property is leasehold, the terms and conditions might prevent short-term letting, so check your lease and speak to the freeholder.
how much can you make on airbnb

Buy to Let in Leeds

Having a buy-to-let property in Leeds is a practical investment because it has been a massive student city over the decades. This city in the UK caters to students who are looking for a low-cost place to study. 

Based on multiple reports, Leeds has increased rental growth demand over the years! Aside from its active student market, this city also generates about 5% of all UK economic output.

Property Investment in Leeds

If you are looking to buy investment properties in the UK, particularly in Leeds, you have to consider which areas are the most profitable. Whether it is located in the city centre or in the countryside, knowing your estimated annual revenue and high-return investment opportunities is important. Using an accurate Airbnb calculator, it shouldn’t be a difficult task at all!

Buying A Property in Leeds

Once you have decided to buy a property, you have to consider the average price, population, nearby landmarks or attractions, and rental yields to expect – among the rest. Here are some of the most recommended areas in Leeds that you can look into & consider purchasing:

Area Population Average House Price Average Rent Price (pcm) Average Airbnb Revenue Yields
Leeds City Centre 32,300 £179,183 £1,148 £2,055 Investors can expect a steady 5% yield from a Leeds city centre (LS1 postcode) apartment
Headingley (student central) 32,150 £216,734 £845 £1,443 Buy to let landlords can make attractive yields of 7.4%
Woodhouse, Burley, and Hyde Park 45,600 £220,082 £682 - £845 £990 Yields are a minimum of 5-6%. A good student investment property could return 9-10% or more

Source: Property Investments in Leeds

Conclusion 

In my personal opinion, the biggest advantage of running a short-term rental is high return! I’ve talked to hundreds of Airbnb hosts over the past years and frequently met hosts making 15 – 30% gross rental yields, and 10-20% net. It’s also fun to do! 

Airbtics
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