Buy-to-let investors are achieving estimated gross rental yields approaching 7% in parts of England, with northern cities continuing to offer some of the strongest returns, new analysis suggests.
Research by The Letting Partnership puts the average nominal rental yield across England at 5.9%, based on an average property price of £293,262 and monthly rent of £1,446.
Newcastle upon Tyne tops the analysis with an estimated yield of 6.9%. The calculation is based on an average property price of £208,589 and monthly rent of £1,206.
Portsmouth and Manchester follow, both recording estimated yields of 6.5%, while Southampton and the London borough of Tower Hamlets stand at 6.4%.
Bristol, Blackpool and Nottingham each produce estimated yields of 6.3%, according to the research, followed by Lincoln and Kingston upon Hull at 6.2%.
The figures highlight the continued variation in buy-to-let returns across England, with some relatively affordable regional markets producing stronger headline yields than areas where property values are substantially higher.
In Westminster, average monthly rent stands at £3,168, despite an estimated nominal yield of 4.5%. Kensington and Chelsea has the highest monthly rent included in the analysis at £3,596, but an estimated yield of just 3.5%.
Those rents equate to gross annual rental income of more than £38,000 in Westminster and £43,000 in Kensington and Chelsea before costs.
Chris Mason, COO of The Letting Partnership, commented: “Yield is understandably front of mind for landlords and, as the figures show, there are still parts of the country where investors can achieve very healthy returns.”
