Rental Yields Reach Five-Year High Amid Market Shifts
Gross rental yields across England and Wales have reached a five-year high, hitting 7.2% in February 2025—up from 6% in 2020. Every region has seen an uplift, with the North West leading the way, climbing from 6.1% to 7.8%.
This growth is driven by rental inflation outpacing house price increases. Over the past five years, average rents have soared by 44%, while property prices have grown by 20%. Flats now offer an average gross yield of 7.4%, significantly up from 5.4% in 2020. Houses, while lower yielding, have also seen an increase, from 5.1% to 5.7%.
One example coming to market shortly is a property on Parish Street in Padiham. Listed at £89,950, a yield of 7.5% is more than achievable, while still keeping the monthly rent at a manageable level, helping to attract and retain the best possible tenants.
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Despite tightening regulations, landlord sentiment remains largely steady. According to the Property Academy Landlord Survey 2024, 71% of landlords plan to maintain their portfolio size over the next year, with 9% looking to expand.
Interested in learning more about yields, renting, or the property on Parish Street? Get in touch on 01282 772048 or email toby@pendlehillproperties.co.uk.
Source: Dataloft by PriceHubble, Land Registry
