The UK’s best and worst rental yield spots revealed

Research that could help landlords and potential property investors alike has been published that highlights the best and worst rental yield spots in the UK.

According to Track Capital it has never been more important for investors to weigh up the facts before choosing an area that is right for investment.

That’s because landlords need to consider inflation, wage stagnation and interest rate rises that have an impact on investor sentiment.

‘Rental yield in the UK’s northern regions’

Tobi Mancuso, a director at Track Capital, said: “This year’s research continues where last year’s left off, showing strong traction when it comes to rental yield in the UK’s northern regions – due to the lower price points and strong rental prices.

“We anticipate this trend will continue as rental demand is still massively outstripping supply in these areas, causing further upward pressure on rents.”

He added: “More broadly, the buy-to-let market continues to show resilience even with everything it’s had thrown at it in the past couple of years.”

Scotland offers the best rental returns for landlords

The firm says that Scotland offers the best rental returns for landlords, with an average yield of 5.7%, while investors in the East of England could suffer the worst, with an average yield of 3.65%.

Glasgow claims the crown as the best UK city for rental yields, followed by Middlesbrough, Dundee, Preston and Swansea.

However, the best individual postcode is BD1 in Bradford, west Yorkshire.

The firm says that the BD1 has knocked last year’s winner, NG7 in Nottingham, off the top spot.

The worst individual postcode is CM4, near Chelmsford, with an average yield of 2.1%.

‘See more confidence come back to the property market’

Mr Mancuso said: “As the economy starts to improve, we should see more confidence come back to the property market, which will help performance.

“We forecast this to be towards the latter part of 2023.

He added: “And in the current market, our data shows location is key when it comes to investing well.

“The research shows there are still great opportunities in certain locations where investors can find profitable yields and long-term capital growth.”