Understanding rental yield in 2025
Rental yield is a crucial metric for landlords, representing the annual rental income as a percentage of the property's value. A good rental yield is generally benchmarked at around 5%, but some properties might reap yields as high as 7% or more.* Houses in Multiple Occupation (HMOs) can achieve between 12% and 15%.*
Top areas for rental yields
Recent data highlights that certain regions in the UK are consistently outperforming others in terms of rental yields. Areas with lower property prices but strong tenant demand tend to offer the best returns for landlords. These regions often feature a combination of affordable property values and a steady flow of tenants, making them attractive for buy-to-let investors. Landlords in these areas can expect higher yields compared to more expensive regions, where property prices tend to absorb much of the rental income, reducing the overall yield percentage.
Zoopla's rental yield calculator
To assess your property's yield, Zoopla offers a rental yield calculator. By inputting your property's purchase price and expected monthly rent, you can determine your property's yield and compare it to local averages. This tool is invaluable for landlords looking to evaluate potential investments or reassess existing portfolios .
Factors influencing rental yields
- Property location: Areas with high tenant demand and lower property prices typically offer higher yields.
- Property type: HMOs and multi-unit properties can provide higher yields due to multiple rental incomes.
- Market conditions: Economic factors, interest rates, and local market trends can impact rental yields. A
Optimising your rental yield
To enhance your property's yield:
- Consider property types that naturally offer higher yields, such as HMOs.
- Invest in areas with growing tenant demand but still affordable property prices.
- Maintain and upgrade your property to attract quality tenants and justify higher rents.
- Stay informed about local market trends and adjust your strategies accordingly.
Evaluate your property's yield today with our expert team
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