Buy-to-Let Yield Map 2018

Tighter lending criteria, the tenant fee ban, and changes to mortgage tax relief are all making it harder for landlords to turn a profit. But yields don’t have to be small — if you know where to look…

We’ve looked at 580,000 properties across England, Scotland, and Wales to find the areas that offer the highest buy-to-let yields. Whether you’re a seasoned landlord looking to add to your portfolio, or a beginner looking for your first investment, use our map to find the best rental yield.

Buy-to-let yield map

6%-100%
4.5%-5.99%
3%-4.49%
1.5%-2.99%
0%-1.49%

Look to students for good rental yields: university hotspots

Our research shows university cities have some of the highest rental yields, with Liverpool, Manchester, Middlesbrough, Newcastle upon Tyne, and Edinburgh shown to be top performers. Due to new students arriving in these cities year after year, there’s no shortage of tenants for landlords to choose from, making void periods very unlikely.

Liverpool

Middlesbrough

Edinburgh

Manchester

Newcastle upon Tyne

The best buy-to-let areas in Britain

Rank#
PostcodePC Postcode Town Properties for Rent Average Monthly Rental Value Properties for Sale Average Asking Price Yield
1 L7 Liverpool 276 £1,162 64 £118,225 11.79%
2 L6 Liverpool 287 £1,046 131 £108,940 11.52%
3 TS1 Middlesbrough 234 £595 102 £65,238 10.94%
4 EH8 Edinburgh 52 £1,962 33 £221,640 10.62%
5 M14 Manchester 787 £1,636 72 £194,733 10.08%
6 NE6 Newcastle upon Tyne 883 £883 237 £111,767 9.48%
7 L1 Liverpool 217 £953 411 £122,152 9.36%
8 PR1 Preston 675 £903 586 £125,341 8.65%
9 M19 Manchester 75 £1,331 67 £185,645 8.60%
10 FY8 Blackpool 80 £1,490 252 £209,556 8.53%
11 GU14 Guilford 142 £2,277 346 £322,377 8.48%
12 BD1 Bradford 182 £446 152 £63,914 8.37%
13 EH11 Edinburgh 83 £1,215 56 £181,648 8.03%
14 EH12 Edinburgh 67 £2,078 64 £316,584 7.88%
15 EH9 Edinburgh 84 £2,284 33 £347,982 7.88%
16 BS2 Bristol 50 £1,319 43 £201,014 7.87%
17 HD1 Huddersfield 280 £874 70 £134,728 7.78%
18 EH16 Edinburgh 33 £1,639 54 £255,417 7.70%
19 S2 Sheffield 271 £809 83 £128,169 7.57%
20 L3 Liverpool 367 £922 1024 £149,976 7.38%
21 L2 Liverpool 60 £833 296 £136,271 7.34%
22 BH9 Bournemouth 122 £1,776 81 £292,982 7.27%
23 NE1 North East 603 £1,044 128 £174,248 7.19%
24 G11 Glasgow 63 £951 53 £159,272 7.17%
25 M20 Manchester 327 £1,460 74 £247,026 7.09%

London’s low lettings lucre

It might come as no surprise that London didn’t perform well for rental yields. Property prices are much higher than those in other areas across England, Scotland, and Wales, making it much harder for landlords to turn a profit.

Worst buy-to-let areas in London

Rank#
PostcodePC Area Properties for Rent Average Monthly Rental Value Properties for Sale Average Asking Price Yield
1 NW11 Golders Green 320 £3,089 356 £1,596,115 2.32%
2 NW5 Kentish Town 211 £1,962 224 £1,026,913 2.29%
3 SE1 Southwark 1102 £2,546 1310 £1,344,885 2.27%
4 SE24 Herne Hill 39 £1,600 87 £849,195 2.26%
5 W8 Kensington 1132 £5,445 341 £2,895,440 2.26%
6 N20 Whetstone 56 £2,145 155 £1,156,231 2.23%
7 W2 Paddington 2363 £3,339 1091 £1,853,766 2.16%
8 SW8 South Lambeth 671 £2,538 1125 £1,500,794 2.03%
9 N2 East Finchley 165 £3,460 217 £2,702,638 1.54%
10 N6 Highgate 172 £2,311 242 £1,845,557 1.50%

If your heart is truly set on a London buy-to-let investment, here are the top 10 areas that offer the highest rental yields.

Best buy-to-let areas in London

Rank#
PostcodePC Area Properties for Rent Average Monthly Rental Value Properties for Sale Average Asking Price Yield
1 E6 East Ham 214 £1,414 230 £352,539 4.81%
2 E13 Plaistow 120 £1,470 197 £390,288 4.52%
3 SE28 Thamesmead 82 £1,171 94 £313,961 4.48%
4 E12 Manor Park 94 £1,468 122 £410,047 4.30%
5 E4 Chingford 109 £1,626 312 £474,969 4.11%
6 E15 Stratford 468 £1,621 440 £473,909 4.10%
7 SE17 Charlton 203 £2,045 138 £605,522 4.05%
8 NW3 Hampstead 1091 £5,876 733 £1,779,586 3.96%
9 E14 Poplar 2320 £2,064 2065 £626,876 3.95%
10 NW9 The Hyde 444 £1,512 660 £461,965 3.93%

The worst postcodes for buy-to-let yields

Rank#
PostcodePC Area Properties for Rent Average Monthly Rental Value Properties for Sale Average Asking Price Yield
1 BL6 Bolton 47 £588 239 £306,726 2.30%
2 NW5 London 211 £1,962 224 £1,026,913 2.29%
3 HP9 Hemel Hempstead 40 £2,721 95 £1,424,373 2.29%
4 TW20 Twickenham 373 £1,501 230 £788,163 2.29%
5 SE1 London 1102 £2,546 1310 £1,344,885 2.27%
6 SE24 London 39 £1,600 87 £849,195 2.26%
7 W8 London 1132 £5,445 341 £2,895,440 2.26%
8 SA3 Swansea 37 £830 392 £442,569 2.25%
9 BR7 Bromley 45 £1,365 134 £729,603 2.25%
10 LS18 Leeds 57 £602 127 £322,954 2.24%
11 SO41 Southampton 40 £1,216 401 £652,898 2.23%
12 N20 London 56 £2,145 155 £1,156,231 2.23%
13 TF9 Telford 37 £559 254 £302,818 2.22%
14 L39 Liverpool 55 £749 178 £405,844 2.21%
15 HA7 Harrow 110 £1,540 292 £841,555 2.20%
16 DA5 Dartford 31 £956 112 £530,215 2.16%
17 W2 London 2363 £3,339 1091 £1,853,766 2.16%
18 HX3 Halifax 40 £499 160 £278,597 2.15%
19 TN2 Tonbridge 64 £867 154 £495,986 2.10%
20 DN22 Doncaster 42 £469 203 £269,247 2.09%
21 SW8 London 671 £2,538 1125 £1,500,794 2.03%
22 CW12 Crewe 41 £587 162 £403,840 1.74%
23 BH14 Bournemouth 64 £1,092 271 £778,315 1.68%
24 N2 London 165 £3,460 217 £2,702,638 1.54%
25 N6 London 172 £2,311 242 £1,845,557 1.50%

Head of Brand & Content, Joe Gardiner, said: “Year after year, there’s a constant flux of students looking for somewhere to bed down for the night, so it’s no surprise that university cities offer landlords the highest buy-to-let yields. Demand is high, and landlords may use this as an opportunity to drum up competition between tenants and push rental yields higher.”

“Landlords need to go into property investment well-armed: they need to be on top of their credit rating, compare the best buy-to-let mortgage rates, and focus on property investment in areas that can give them the highest yield. That’s where our map can help.

"And our free credit report, buy-to-let mortgage comparison tool, ultimate guide to buy-to-let mortgages and in-depth guide to maximising profits from buy-to-let investment complete a suite of invaluable tools for landlords."

It seems the low rental yields that affect England’s capital don’t apply to Scotland’s, as the top five spots are all taken by Edinburgh postcodes.

Best buy-to-let areas in Scotland

Rank#
PostcodePC AreaArea Properties for Rent Average Monthly Rental Value Properties for Sale Average Asking Price Yield
1 EH8 Edinburgh 52 £1,962 33 £221,640 10.62%
2 EH11 Edinburgh 83 £1,215 56 £181,648 8.03%
3 EH12 Edinburgh 67 £2,078 64 £316,584 7.88%
4 EH9 Edinburgh 84 £2,284 33 £347,982 7.88%
5 EH16 Edinburgh 33 £1,639 54 £255,417 7.70%
6 G11 Glasgow 63 £951 53 £159,272 7.17%
7 AB11 Aberdeen 256 £640 50 £110,012 6.98%
8 EH3 Edinburgh 178 £2,113 48 £365,370 6.94%
9 G42 Glasgow 35 £577 64 £99,991 6.92%
10 AB24 Aberdeen 305 £731 76 £135,297 6.48%

Worst buy-to-let areas in Scotland

Rank#
PostcodePC AreaArea Properties for Rent Average Monthly Rental Value Properties for Sale Average Asking Price Yield
1 AB21 Aberdeen 68 £694 51 £220,230 3.78%
2 AB12 Aberdeen 55 £791 49 £257,299 3.69%
3 AB15 Aberdeen 120 £1,057 45 £354,477 3.58%
4 IV30 Inverness 46 £527 181 £182,974 3.46%
5 KY12 Kirkcaldy 46 £506 149 £175,713 3.46%
6 FK2 Falkirk 39 £492 81 £172,964 3.41%
7 PH1 Perth 115 £515 212 £184,724 3.35%
8 PH2 Perth 61 £563 164 £211,756 3.19%
9 DD11 Dundee 74 £472 66 £186,085 3.04%
10 DD8 Dundee 49 £507 64 £208,436 2.92%

Wales’ performance is a little more mixed, as four Cardiff postcodes feature in both the bottom and top 10. Likewise, five Swansea postcodes rank in the bottom and top 10.

Best and worst buy-to-let areas in Wales

Rank#
PostcodePC AreaArea Properties for Rent Average Monthly Rental Value Properties for Sale Average Asking Price Yield
1 CF10 Cardiff 241 £1,042 128 £177,397 7.05%
2 CF37 Cardiff 235 £705 192 £138,245 6.12%
3 SA1 Swansea 711 £789 350 £156,725 6.04%
4 SA5 Swansea 32 £502 161 £121,647 4.95%
5 CF11 Cardiff 161 £812 179 £203,280 4.79%
6 NP19 Newport 35 £660 94 £170,678 4.64%
7 CF24 Cardiff 929 £1,087 112 £288,953 4.51%
8 SA11 Swansea 41 £463 185 £132,052 4.21%
9 SA6 Swansea 56 £484 200 £142,615 4.07%
10 SA31 Swansea 68 £671 143 £198,641 4.05%

Best and worst buy-to-let areas in Wales

Rank#
PostcodePC AreaArea Properties for Rent Average Monthly Rental Value Properties for Sale Average Asking Price Yield
1 SA2 Swansea 188 £778 253 £272,330 3.43%
2 CF23 Cardiff 93 £816 112 £286,448 3.42%
3 CF64 Cardiff 40 £923 179 £330,328 3.35%
4 CF62 Cardiff 46 £630 209 £226,441 3.34%
5 SA18 Swansea 32 £478 291 2,772 3.32%
6 SA4 Swansea 55 £569 250 £208,042 3.28%
7 SA73 Swansea 38 £481 181 £179,776 3.21%
8 NP20 Newport 67 £530 114 £203,880 3.12%
9 CF5 Cardiff 56 £719 156 £284,396 3.03%
10 SA3 Swansea 37 £830 392 £442,569 2.25%

Why are landlords feeling the squeeze?

The phasing out of mortgage tax relief that started in April 2017 has already seen some landlord’s tax bills soar, but this is set to rise even further over the next two years: there will be no mortgage tax relief for landlords from April 2020. For some, this will see their tax bill more than double.

And that’s without the tenant fee ban that’s soon to be introduced. With draft legislation already underway, landlord’s margins might be squeezed even tighter from having to absorb letting fees themselves.

Plus, lenders tightened their buy-to-let mortgage criteria in September 2017 in response to changes in legislation. Before getting a mortgage, borrowers must satisfy lenders that the rent will cover monthly mortgage payments, with some to spare. Lenders calculate the monthly repayment on an assumed rate of 5.5%; the rent must then cover this figure by a surplus of 25–45%, making it harder for landlords to finance their property investments.

With so much change threatening landlord’s profits, it’s now more important than ever for them to maximise their rental yields. Our map makes it easy to spot where to get more bang for your buck.

For an idea of how lenders view you, sign up for your Free Credit Report. You’ll get clear picture of your credit rating and your borrowing potential, and signing up won’t harm your credit score. Your next stop should then be our buy-to-let mortgage comparison tool — designed to help you find the best buy-to-let mortgages.

Buy-to-let index

Buy-to-let yield is defined as average annual rent divided by average asking price.

Data is based on an analysis of 233,561 rental properties and 354,733 properties marketed for sale on Zoopla.

Postcodes require more than 30 properties for sale and 30 properties for rent to be included. Postcode map data collated from Wikipedia.