2 top UK shares (including a 7.5% dividend yield) under £2 to buy!

UK share markets finished 2021 with a bang as investor tensions over Covid-19 crisis eased. This meant that the FTSE 100 has posted a healthy rise of around 15% with just one trading day left. The FTSE 250 has risen by the same percentage.

I think it’s a bit premature to get too excited, though. The ongoing public health emergency could throw up fresh surprises if new coronavirus variants emerge. Let’s not forget that infection rates are currently rocketing across much of the globe and fresh economically damaging lockdowns could be looming. Inflationary pressures are rising that could hammer consumer spending and prompt severe interest rate hikes.

I don’t think this is reason for me to stop buying UK shares, however. There are many stocks out there that I believe will have a strong 2022 despite those risks. Here are two cheap stocks I’d buy in the New Year and hold for years to come.

7.5% dividend yields

Buying shares that help electrify the planet could be a great idea as populations grow and wealth levels in emerging markets balloon. According to the International Energy Agency world energy demand is set to almost double between now and 2050. I’d buy ContourGlobal (LSE: GLO) shares to exploit this phenomenon.

ContourGlobal builds, acquires and operates power stations across the globe. It produces energy using sources like coal, natural gas, wind and hydro, but it is increasingly embracing ‘green’ technology and recently vowed not to build any more coal plants. This will allow it to exploit growing demand for clean energy from governments and industry.

I expect ContourGlobal to deliver decent profits in the coming decades, even though project slippage is an ever-present danger that can hit earnings hard. Costs can spiral and revenue forecasts can be torn up. I think its monster 7.5% dividend yield for 2022 makes it a particularly attractive renewable energy stock to buy.

Another dividend-paying UK share I’d buy

I’m thinking of bulking up my exposure to Taylor Wimpey (LSE: TW). House prices ballooned in 2021 thanks in part to the earlier moratorium on Stamp Duty payments. But I’d be mistaken if I thought this was the sole reason why property values have rocketed. Historically-low interest rates, ultra-attractive mortgage products, and continued government support via Help to Buy have also helped light a fire under home-buying activity.

Latest home price figures from Halifax prove that the housing market remains red-hot despite the return of the homebuyer tax. This showed average property values hit a fresh all-time high in December, at £254,822.

I believe, then, that owning home-building shares remains a good option for me. So buying more Taylor Wimpey shares could be a good move for me, especially at recent prices. Today it trades on a forward P/E ratio of 9.4 times. It carries a mammoth 5.8% dividend yield too. I’d buy it even though homes demand could suffer if the British labour market worsens and interest rates rise at breakneck pace.

Royston Wild owns Taylor Wimpey. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.