Rental yields across England and Wales hit 7.4% in the final three months of last year, up 0.6% from a year ago, data from the Fleet Mortgages shows.
This is also 0.2% higher than the previous quarter, according to the buy-to-let specialist’s latest rental barometer.
The survey says: “Rental yields remain almost universally positive, with only one region in England and Wales, the West Midlands, showing a year-on-year fall.
“However, compared to the previous quarter, three regions – Greater London, the North East and the West Midlands — have all seen reducing yields.”
It adds that the wider national picture shows that “rental yields were broadly static compared to a year ago”.
The North East continues to lead the average rental yield table at 9.3% with Yorkshire & Humberside moving up to second place with 8.6%, above the North West with 8.3%, which slips to third spot.
Rental returns in the West Midlands came in at 6.6%, down 0.5% from a year ago.
The study points out that the highest average monthly rent per property is in Greater London at £2,056, followed by the South West at £1,734.
Properties located within the North East typically contain the most affordable rental stock, with an average monthly rent of £706.
Fleet Mortgages chief commercial officer Steve Cox says: “There is certainly a greater degree of positivity around the buy-to-let market now than at this time last year, even with the Budget decision to increase stamp duty surcharges for landlord purchasers.
“Our rental barometer reflects that optimism over the last quarter of 2024, with average rental yields — on the whole — continuing to improve, albeit at a slightly slower rate, but also in terms of Fleet’s figures for average monthly rents, average rates, average loan sizes, rental cover, and application numbers for property purchases.
Cox adds: “Certainly, many landlords were waiting for the Budget before making decisions, but even with the stamp duty increase, at least they now have certainty about the future, can plan accordingly, and as mentioned, the financial position is positive which will allow more landlords to act and to add to portfolios where appropriate.”
