Highest Yielding UK Buy-to-Let Areas 2026
Thinking about becoming a landlord? One effective investment strategy is to target high-yield markets. Here are the top investor hotspots in the UK.
If you’re aiming for the highest return on your investment, understanding rental yield is crucial when buying a buy-to-let property.
Gross rental yield is the annual rental income as a percentage of the property price. Net rental yield also includes the costs of maintaining and renting out the property. Both measures can help determine if a property is a good investment.
The average gross rental yield in the UK is currently 5.60%, based on an average buy-to-let property price of £261,897 and an average rent of £1,223 per month, according to recent data.
Gross yields have improved in all regions over the past year as house prices have stabilised or decreased, while rents have continued to rise.
Remember, tenant demand and potential house price growth, among other factors, should also be considered when investing in property.
Key takeaways
- If you’re considering a buy-to-let property, rental yield can help you determine if the property’s cost is worth the potential rental income.
- Gross rental yields have risen over the last year as rents have increased faster than house prices.
- The highest yielding cities in the UK are Sunderland, Aberdeen, and Burnley, each offering average gross yields of over 8%.
- The North East is the top region for investors seeking strong yields, with an average of 7.65%.
- We reveal the three highest yielding areas in every region of the UK.
- Remember to consider other factors before investing, such as tenant demand and the potential for future house price growth.
Top cities for rental yields in the UK
Sunderland, Aberdeen, and Burnley lead the UK in rental yields, with average gross yields over 8%.
The top 17 cities for rental yields are all in the North of England and Scotland. In contrast, southern cities have higher house prices, reducing gross yields for buy-to-let properties.
Here’s a comparison of gross rental yields across UK cities.
| City | Average gross rental yield | Average monthly rent | Average price of a buy-to-let property |
| Sunderland | 8.96% | £626 | £83,842 |
| Aberdeen | 8.03% | £689 | £102,920 |
| Burnley | 8.00% | £566 | £84,869 |
| Dundee | 7.96% | £774 | £116,690 |
| Glasgow | 7.95% | £951 | £143,617 |
| Middlesbrough | 7.92% | £613 | £92,862 |
| Blackburn | 7.52% | £661 | £105,460 |
| Hull | 7.45% | £612 | £98,617 |
| Newcastle | 7.45% | £833 | £134,245 |
| Liverpool | 7.44% | £801 | £129,172 |
| Stoke | 7.38% | £735 | £119,562 |
| Grimsby | 7.16% | £608 | £101,883 |
| Barnsley | 7.15% | £684 | £114,805 |
| Bradford | 7.02% | £692 | £118,267 |
| Blackpool | 6.98% | £692 | £119,049 |
| Wigan | 6.96% | £752 | £129,656 |
| Swansea | 6.92% | £867 | £150,377 |
| Preston | 6.91% | £784 | £136,148 |
| Rochdale | 6.85% | £815 | £142,781 |
| Bolton | 6.80% | £790 | £139,483 |
| Doncaster | 6.79% | £678 | £119,911 |
| Leeds | 6.67% | £969 | £174,269 |
| Coventry | 6.66% | £1,015 | £182,782 |
| Nottingham | 6.64% | £947 | £171,146 |
| Cardiff | 6.59% | £1,119 | £203,663 |
| Wakefield | 6.56% | £737 | £134,826 |
| Birkenhead | 6.54% | £713 | £130,914 |
| Manchester | 6.53% | £1,070 | £196,603 |
| Huddersfield | 6.42% | £704 | £131,596 |
| Mansfield | 6.41% | £732 | £137,105 |
| Plymouth | 6.39% | £878 | £164,771 |
| Sheffield | 6.38% | £809 | £152,051 |
| Southampton | 6.34% | £1,121 | £212,118 |
| Newport | 6.32% | £879 | £166,835 |
| Warrington | 6.30% | £863 | £164,258 |
| Derby | 6.28% | £798 | £152,479 |
| Gloucester | 6.28% | £945 | £180,449 |
| Peterborough | 6.24% | £907 | £174,548 |
| Belfast | 6.16% | £751 | £146,190 |
| Ipswich | 6.16% | £879 | £171,273 |
| Portsmouth | 6.14% | £1,161 | £226,802 |
| Birmingham | 6.10% | £934 | £183,628 |
| Medway | 6.09% | £1,176 | £231,635 |
| Luton | 6.08% | £1,145 | £226,150 |
| Northampton | 6.08% | £977 | £192,858 |
| Edinburgh | 6.03% | £1,263 | £251,423 |
| Swindon | 6.03% | £969 | £192,908 |
| Telford | 5.92% | £809 | £164,075 |
| Norwich | 5.83% | £1,065 | £219,141 |
| Leicester | 5.77% | £924 | £192,229 |
| Bournemouth | 5.68% | £1,243 | £262,577 |
| Bristol | 5.66% | £1,389 | £294,503 |
| Hastings | 5.58% | £1,016 | £218,348 |
| Worthing | 5.52% | £1,171 | £254,618 |
| Reading | 5.48% | £1,412 | £309,293 |
| Aldershot | 5.47% | £1,325 | £290,646 |
| Crawley | 5.46% | £1,376 | £302,547 |
| MiltonKeynes | 5.41% | £1,202 | £266,589 |
| Brighton | 5.39% | £1,616 | £360,102 |
| York | 5.22% | £1,111 | £255,222 |
| Southend | 5.15% | £1,152 | £268,305 |
| London | 4.95% | £2,047 | £496,124 |
| Oxford | 4.79% | £1,667 | £417,737 |
| Cambridge | 4.50% | £1,527 | £407,603 |
Top regions for rental yields in the UK
Rents in the North East are the cheapest in the country at £695, with buy-to-let properties averaging £109,072. This gives the region the highest average yield in the UK at 7.65%.
Scotland follows with 7.48%, then the North West at 6.66%, Wales at 6.43%, and Yorkshire and the Humber at 6.38%. Gross yields in these regions have risen recently as rents have increased faster than house prices.
London has the lowest gross yields in the UK at 4.93%, only slightly higher than three months ago. Higher mortgage rates, new regulations, and slow house price growth have capped rent affordability, leading to moderated tenant demand.
The East of England and South East also have lower gross yields, at 5.28% and 5.34%, respectively. However, their yields have improved compared to last year due to the largest declines in house prices.
| Region | Average gross rental yield | Average monthly rent | Average price of a buy-to-let property |
| North East | 7.65% | £695 | £109,072 |
| Scotland | 7.48% | £793 | £127,284 |
| North West | 6.66% | £848 | £152,719 |
| Wales | 6.43% | £881 | £164,388 |
| Yorkshire and the Humber | 6.38% | £799 | £150,261 |
| Northern Ireland | 6.11% | £735 | £144,423 |
| West Midlands | 5.95% | £905 | £182,531 |
| East Midlands | 5.84% | £860 | £176,730 |
| South West | 5.37% | £1,077 | £240,472 |
| South East | 5.34% | £1,325 | £297,971 |
| East of England | 5.28% | £1,163 | £264,539 |
| London | 4.93% | £2,121 | £516,295 |
The highest yielding areas in each part of the UK
Looking for a buy-to-let property near where you live can be useful. You know the area, understand local influences on the market and can work closely with a nearby letting agent.
So it helps to know which parts of your region offer the greatest rental yield. Here are the top 3 local authorities for average yields in each UK region.
North East: 7.65% average gross yield
- County Durham: 7.81% gross rental yield
- Darlington: 7.52% gross rental yield
- Gateshead: 7.75% gross rental yield
Scotland: 7.48% average gross yield
- Renfrewshire: 9.56% gross rental yield
- East Ayrshire: 9.50% gross rental yield
- West Dunbartonshire: 9.09% gross rental yield
North West: 6.66% average gross yield
- Burnley: 8.40% gross rental yield
- Blackpool: 7.80% gross rental yield
- Preston: 7.55% gross rental yield
Wales: 6.43% average gross yield
- Blaenau Gwent: 7.58% gross rental yield
- Neath Port Talbot: 7.44% gross rental yield
- Merthyr Tydfil: 7.40% gross rental yield
Yorkshire and the Humber: 6.38% average gross yield
- Hull: 7.45% gross rental yield
- North East Lincolnshire: 7.16% gross rental yield
- Barnsley: 7.15% gross rental yield
West Midlands: 5.95% average gross yield
- Stoke-on-Trent: 7.72% gross rental yield
- Coventry: 6.66% gross rental yield
- Newcastle-under-Lyme: 6.65% gross rental yield
East Midlands: 5.84% average gross yield
- Nottingham: 7.27% gross rental yield
- Mansfield: 6.57% gross rental yield
- Boston: 6.50% gross rental yield
South West: 5.37% average gross yield
- Plymouth: 6.39% gross rental yield
- Gloucester: 6.28% gross rental yield
- Swindon: 6.03% gross rental yield
South East: 5.34% average gross yield
- Southampton: 6.62% gross rental yield
- Gosport: 6.46% gross rental yield
- Portsmouth: 6.45% gross rental yield
East of England: 5.28% average gross yield
- Great Yarmouth: 6.42% gross rental yield
- Peterborough: 6.24% gross rental yield
- Fenland: 6.17% gross rental yield
London: 4.93% average gross yield
- Barking and Dagenham: 6.22% gross rental yield
- Newham: 5.89% gross rental yield
- Bexley: 5.68% gross rental yield
What’s the outlook for buy-to-let property investment in the UK?
UK rent increases are slowing down, with annual growth now at its lowest rate in two years, dropping to 7.8% from 11% last year as demand has decreased by 20%.
Despite this, there are still over 15 enquiries for each rental property, which is twice the rate seen before the pandemic. New investment from private landlords is still low, and the average letting agent lists 12 homes for rent. This figure is 20% higher than last year but 28% below the pre-pandemic average of 16 homes.
While the gap between supply and demand is closing, it remains significant. We expect UK rental inflation to be around 5% in 2024.
The outlook for buy-to-let investment also depends on house prices, which we expect to remain stable this year. With rents generally increasing faster than house prices, gross rental yields are likely to rise in 2024.
What is rental yield?
Rental yield measures the annual income from a rental property compared to the cost of buying and maintaining it, expressed as a percentage.
Gross yield considers only the purchase cost and rental income, while net yield also includes additional costs like maintenance and property management.
When evaluating an investment property, it’s important to consider both types of yields and other relevant factors.
Why is rental yield important?
Before buying a rental property, it’s essential to determine if it’s a worthwhile investment.
If your rental income only covers your costs or you’re just breaking even, unexpected expenses like repairs can strain your finances.
Assessing the potential rental yield helps you calculate whether the investment will be profitable.
What else to think about with a buy-to-let property
Choosing a good buy-to-let property involves more than just looking at rental yield.
Even with a strong yield, if house prices aren’t rising or you struggle to find tenants, it might not be the best investment.
House Price Trends
Look at house price growth to see if the property is likely to increase in value. Check historic sale prices for individual properties and value changes for the postcode and local area.
Cost of a Buy-to-Let Mortgage
Consider the costs of a buy-to-let mortgage and other expenses associated with running a rental property.
Tenant Demand
Understand tenant demand in the area and the types of properties they are looking for. Speak to a letting agent to get insights into the local rental market and identify properties that could be strong buy-to-let investments.
How to work out your gross rental yield
If you want to buy a property for £200,000 and charge £1,000 per month in rent, that totals £12,000 per year. To calculate the gross yield, divide £12,000 by £200,000 and multiply by 100. This gives you a gross yield of 6%.
Formula:
(Annual rent / Property value) x 100 = Gross rental yield
Best rental yield areas UK 2026: the regional update
UK rental yields have shifted noticeably over the past 18 months as interest rates settled and regional demand patterns rebalanced. Here’s where landlord yields are highest in 2026 — based on actual rents achieved vs property purchase prices in the past 12 months, not advertised “asking” rents.
The top 10 highest-yielding UK postcodes (gross yield, May 2026)
- TS1 / TS3 — Middlesbrough centre / east — gross yields routinely 9.5-12%. Cheap entry (£60,000-£90,000 for 2-bed terrace), strong tenant demand from students and key workers. Best regional yield play in 2026.
- SR1 / SR4 — Sunderland — 9-11% gross. Similar profile to Middlesbrough. Entry prices £70,000-£100,000 for standard BTL.
- BD1-BD5 — Bradford — 8.5-10.5% gross. Very strong HMO market — convert a 4-bed family home to 5-6 room HMO and you can hit 12%+ on managed rooms.
- HU1-HU9 — Hull — 8-10% gross. Below-£100k entry, student demand around the university postcodes.
- BL1-BL9 — Bolton — 8-9.5% gross. Cheaper than Manchester proper, with good transport links into the city.
- OL1-OL9 — Oldham — 7.5-9% gross. Article 4 Direction in some areas (check before HMO conversion). Strong family-let market.
- ST1-ST4 — Stoke-on-Trent — 7.5-9.5% gross. £60,000-£110,000 entry. Major HMO market.
- NE6 / NE5 — Newcastle outer — 7-8.5% gross. Better-quality stock than the lower-yield postcodes above, with stronger capital growth attached.
- L4 / L5 / L6 — Liverpool inner — 7-8.5% gross. Mix of student lets and key worker tenants. Regeneration adding to upside.
- S2 / S4 — Sheffield east — 6.5-8% gross. Solid family-let area, stronger long-term capital growth than the deeper-yield postcodes.
Where yields are still weak in 2026
- London zones 1-3 — 3.5-4.5% gross. Capital growth focus, not income.
- Most of Surrey, Berkshire, Buckinghamshire — 3.5-5% gross. Same logic.
- The Cotswolds, North Yorkshire Dales, prime coastal — 3-4.5% on long-term lets (but 8-15% achievable via serviced accommodation if you accept the operational complexity).
- Edinburgh prime postcodes — 4-5%. Strong capital growth, weaker income.
Cities to watch — where 2026 yields are improving fastest
- Preston (PR1-PR5) — currently 6.5-8% gross but property prices have lagged. Two universities, BAE engineering hub, strong professional tenant pool. Yields should hold or improve through 2026-27.
- Bradford BD7 (university) — student-focused HMO yields creeping above 12% in some streets. Plan around Article 4 carefully.
- Doncaster (DN1-DN4) — emerging 7-8.5% yields with HS2-adjacent rumours improving sentiment.
- Hartlepool (TS24-TS27) — the cheapest entry points in the UK (£40,000-£75,000 for some 2-bed terraces), yields 9-11% gross. Higher void risk than Middlesbrough though.
The honest health warning
A high yield is not the same as a high return. The cheapest highest-yielding areas often come with:
- Higher void periods (3-8 weeks/year vs 1-3 weeks in better areas)
- More tenant management work (lower-credit-score tenants, more arrears risk)
- Weaker capital growth (the cheap-buy reason often persists for years)
- Higher maintenance ratios (older, less well-built housing stock)
- Some postcodes are no-go for mainstream lenders — check finance availability before committing
The right benchmark is net yield after voids, management, maintenance, insurance, mortgage interest and tax — not gross yield on day one. A 6% gross yield property in a stable mid-market area often produces better net cashflow than a 10% gross yield in a deep-yield postcode after you account for the realistic operational drag.
UK Buy-to-Let Yields FAQs
Where are the highest BTL rental yields in the UK in 2026?
Sunderland, Bradford, Burnley, Middlesbrough and parts of Glasgow and Liverpool currently lead UK gross rental yields, often above 8%. London and the South East trail at 3–5% gross because of high purchase prices relative to rents.
What is a “good” rental yield in the UK?
For UK buy-to-let, a gross yield of 6–8% is widely considered solid. Net yields after agent fees, voids, insurance, finance and tax typically run 35–55% of gross, so a 7% gross yield often translates to 3–4% net cash yield.
Why do northern UK cities have higher BTL yields than the south?
Property prices in northern cities are 50–70% lower than London prices, but rents are only 30–45% lower. The mismatch produces higher yields. The trade-off: less capital appreciation than the south historically, though that has been narrowing since 2020.
How do I calculate gross rental yield?
Gross yield = (annual rent ÷ purchase price) × 100. Example: £700/month rent on a £100k property = £8,400 ÷ £100,000 = 8.4% gross. Always also calculate the net yield by deducting all operating costs and finance.
Should I prioritise yield or capital growth?
Yield matters more if you need rental cashflow now or are using leverage that demands strong income coverage. Capital growth matters more for long-term wealth building. Most successful UK landlords blend the two — yield in the north, growth-led plays in the south or commuter belt.
Related Property Accelerator guide: Thinking about freeing up equity from your existing portfolio? Our how to refinance a UK mortgage guide covers when to refinance, equity needed, lender comparison, fees, and BTL refinance for portfolio growth.
Preston buy-to-let yields 2026 — what to expect
Preston has quietly become one of the most reliable mid-yield UK rental markets — high enough to make the maths work, but with stronger price stability than the very-northern hot spots. Here’s what investors are seeing in 2026:
- Average gross yield (PR1, PR2 postcodes): 6.5%-8.0% on terraced and small semi-detached properties in the £130k-£170k price band
- Average rent (3-bed terrace): £900-£1,100 pcm in the more central postcodes, £750-£900 pcm in the outer wards
- Average purchase price (3-bed terrace, 2026): £140k-£175k depending on postcode and condition
- Voids: historically low (under 3 weeks per turnover) thanks to tenant demand from the University of Central Lancashire (UCLan) and Preston-area NHS trusts
- Capital growth (5-year): 12-18% — modest but positive, supported by the Preston/Lancashire infrastructure investment plan
Why Preston yields work
Three structural reasons Preston punches above its weight on yield:
- Anchor employers: UCLan (one of the largest employers in Lancashire), Royal Preston Hospital, BAE Systems at nearby Warton, and a strong public sector base. This keeps tenant demand consistent across economic cycles.
- Affordable entry price: 2-bed and small 3-bed terraces still trade in the £120k-£160k bracket, putting Preston in BTL deposit reach for investors with £35k-£45k cash.
- Transport and regeneration: the Preston Western Distributor opened in 2023, and the long-running City Deal regeneration programme continues to drive new build and infrastructure spend in PR2 and PR4.
Best postcodes for Preston BTL in 2026
- PR1 (city centre, Avenham, Frenchwood): highest gross yields (often 7.5-8.5%) but mixed condition stock and higher tenant turnover. Best for experienced landlords or HMO conversion.
- PR2 (Fulwood, Ingol, Cottam): the sweet spot for single-let BTL — better-quality stock, professional tenant base, gross yields 6.5-7.5%, lower management hassle.
- PR4 (Penwortham, Lostock Hall, Bamber Bridge): family-tenant base, slightly lower yields (5.5-6.5%) but stronger capital growth potential and very low voids.
- PR5 (Bamber Bridge, Walton-le-Dale): mid-range, good balance of yield and stability.
Preston-specific risks to watch
- HMO licensing in Preston is an Article 4 area for parts of PR1 — check before converting any property to HMO use.
- Some PR1 streets near the city centre have noticeable parking and antisocial behaviour issues that affect rental and resale demand. Always physically visit before bidding.
- Preston is part of the proposed Lancashire devolution settlement — local taxation and licensing rules may shift over the next 2-3 years.
For comparison with other northern markets, see the city-by-city breakdown earlier in this guide. Preston typically falls between Manchester (lower yield, higher growth) and Burnley (higher yield, more management) on the risk-return curve.
Further reading from Property Accelerator
More guides on related topics — each linked guide goes deep on its specific area:
Many of the highest-yield areas have significant leasehold flat stock — always check the remaining lease length before committing capital. What happens when a leasehold expires →
In areas where leasehold flats dominate the yield play, collective enfranchisement can be a useful long-term value protection move. Changing leasehold to freehold →
In yield markets where HMO is the natural play, the licensing question is critical — some configurations fall outside the mandatory regime. How to avoid an HMO licence →
Further reading from Property Accelerator
More guides on related topics — each linked guide goes deep on its specific area:
Many of the highest-yield areas have significant leasehold flat stock — always check the remaining lease length before committing capital. What happens when a leasehold expires →
In areas where leasehold flats dominate the yield play, collective enfranchisement can be a useful long-term value protection move. Changing leasehold to freehold →
In yield markets where HMO is the natural play, the licensing question is critical — some configurations fall outside the mandatory regime. How to avoid an HMO licence →
Flipping houses in the UK — In high-yield areas, the comparison investors most often run is yield-and-hold versus flip-for-cash. Flipping in these areas can deliver £15-£40k per project but requires the right discount-to-market entry.
Many of the highest-yield UK markets — particularly tourist coastal towns and city centres with strong business-traveller demand — work even better as serviced accommodation than as long-term BTL. The Property Accelerator Serviced Accommodation Course covers how to identify and operate in those markets.
Many of the highest-yield UK markets perform even better as serviced accommodation than long-term BTL — but the mortgage product needed is different. Our UK serviced accommodation mortgage guide covers specialist lenders and what’s changed post-FHL.
About the author — James Nicholson
Founder, Property Accelerator · 25+ years investing in UK property
James has built and run portfolios across buy-to-let, HMOs, serviced accommodation, BRRRR projects and lease options. He trains thousands of UK landlords and investors through Property Accelerator and writes practical, real-world investment guides covering strategy, finance, tax and regulation.
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