8.4% dividend yield! One of the best UK dividend shares to buy today

I’m searching for the best dirt-cheap UK shares that I can buy. Here’s a top dividend stock I think could make me plenty of cash.

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As a long-term stock investor I don’t fear the sort of wild market volatility we’re currently witnessing. It widens my options when I’m searching for the best cheap UK shares to buy.

I’ve explained in some depth why housebuilding shares — including those I personally own — should remain great stocks to buy. And today another round of positive data has reinforced my belief in the strength of the housing sector.

The latest Royal Institution of Chartered Surveyors (RICS) data shows that the UK homes market continues to strengthen, despite recent interest rates hikes, the cost of living crisis, and the recent withdrawal of the stamp duty holiday. Some 79% of surveyors RICS questioned saw house prices increasing in February, up from 74% a month before.

Improving market conditions

RICS also said that the number of new buyer enquiries rose in February for six months on the trot too. So it’s perhaps unsurprising that RICS chief economist Simon Rubinsohn has said that “there is little evidence yet that the mood music regarding the expectations for house prices or rents is shifting.”

Rubinsohn added that “the medium-term projections from respondents to the RICS survey are continuing to gain momentum.” This is despite the huge uncertainty facing the UK economy and suggests that bulking up my exposure to the housebuilding sector is a good idea. I’m thinking of doing this by snapping up Vistry Group (LSE: VTY) shares.

8.4% dividend yields

One of the main reasons why I bought housebuilders Barratt and Taylor Wimpey was their bright dividend prospects. Their exceptional cash generation made them ideal buys for me as I’m seeking a healthy passive income. It gave them the financial strength to remain generous dividend payers even when times got tough.

The pull of big dividends is what’s attracting me to buy Vistry Group today too. City analysts think the substantial 60p per share payout will continue growing in the next two years (to 74.6p and 79.3p in 2022 and 2023 respectively). Following recent share price weakness these projections create massive dividend yields of 7.8% for this year and 8.4% for 2023.

A cheap UK share to buy today

Vistry’s share price has been washed out amid the broader market volatility of recent weeks. The housebuilder just fell to its cheapest since February 2021. And I believe this provides a brilliant all-round dip-buying opportunity.

Vistry doesn’t just offer big dividend yields at its share price today at around 955p. City analysts think the firm’s earnings will rise 11% year-on-year in 2022. As a consequence the share price now commands a rock-bottom forward P/E ratio of just 6.8 times.

Shares like Vistry aren’t without risk of course. If the Bank of England adopts a more aggressive rate-rising programme then demand for its homes could suffer. Vistry and its peers also face the problem of rising building material prices on their profits. Still, I think this particular housebuilder’s ultra-low valuation more than reflects these dangers. Vistry is a bargain share I’d buy to hold for years to come.

Should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice.