Plenty of property sellers and pundits give out lists of property hot spots – but now researchers have pulled together a bottom-of-the-table places of where not to spend on property investment.

These not spots are spread across the UK – with Margate coming out as Britain’s worst buy to let performer with a ‘real yield’ of -9.8%.

The latest study from property analysts Home.co.uk assesses the impact of falling prices against rental returns of two-bedroomed houses to give a more rounded real investment figure.

The top 10 best performers are all in London, but the bad buy to let performers are countrywide.

Doug Shephard, director at Home.co.uk, explained: “The average gross rental yield of these areas is currently running at a healthy 6%, but landlords must consider the rise and fall of capital values when assessing a buy-to-let investment. This study shows that if investors in these worst affected areas are simply taking a short-sighted view, based on rental income, then they could be in for a nasty surprise.”

“Given our new research on yields, these are areas of the UK where landlords are losing money just by owning the property and that is even before tackling the potential issue of void periods.”

“While there are many reports of a North-South divide in the property market, 6 of the 10 worst performing areas are located in the South of England, including the relatively affluent area of Guildford.

“Interestingly, the East Kent seaside towns of Ramsgate, Broadstairs and Margate all report dreadful real yields. In terms of rental income, these three areas can offer landlords gross yields of over 5% yet the underlying property values are falling through lack of demand. For example, in January 2007 the average 2-bed property spent just 56 days on the market in Ramsgate. Now in 2013, the average time on market has risen to 134 days. “

Property investment not spots – February 2013