Recent data indicates a notable increase in landlord gross rental yields across the UK, with overall yields rising by the end of June 2026. This marks an increase from the end of the first quarter, highlighting a positive trend in the mortgage market for buy-to-let investors.
What are the key changes in rental yields?
The latest report reveals that rental yields have been on an upward trend since the end of the Covid lockdowns, rising from previous levels. Scotland experienced the most significant growth, with yields increasing. The West Midlands and Yorkshire & Humber also saw substantial increases in their yields.
How do different regions compare?
Wales continues to lead as the strongest yielding location. Following closely are Scotland and the North East, both achieving notable yields. In contrast, Greater London recorded the sharpest decline in yields, indicating a regional disparity in rental yield performance.
What does this mean for the mortgage market?
The strengthening yields present an opportunity for landlords and investors looking to enter or expand in the buy-to-let market. Properties such as Houses in Multiple Occupation (HMOs) remain the highest yielding type, suggesting that investors may want to focus on specific property types and regions to maximise returns. For those considering financing options, reviewing current mortgage rates is advisable.
Frequently asked questions
What factors are driving the increase in rental yields?
The increase in rental yields can be attributed to a recovering rental market post-Covid, with rising demand in certain regions, particularly outside London.
How should landlords respond to these trends?
Landlords should consider diversifying their portfolios to include high-yield properties like HMOs and explore opportunities in regions with strong yield growth.