The average rental yield for properties across England and Wales increased to 7.4% in the fourth quarter of 2024, according to Fleet Mortgages’s BTL rental barometer.
This is 0.6% higher than the same quarter in 2023 and 0.2% higher than the preceding quarter in the same year.
Rental yields have been broadly positive across most regions with only one, the West Midlands, registering a fall.
In the fourth quarter of 2024, the average rental yield in the West Midlands was 6.6% - 0.5% lower than the same quarter in 2023.
However, three regions — Greater London, the North East and the West Midlands — all recorded falls in average rental yield from the preceding quarter.
The strongest year-on-year change was seen in the North East with 1.3% growth, leading to average rental yield of 9.3% in the fourth quarter for the region.
This is also the highest average rental yield of any region for the fourth quarter, even surpassing Greater London which registered 5.8%.
However, Greater London was revealed to still have the highest average monthly rent per property with £2,056. This was closely followed by the South West with £1,734.
The North East has the most affordable rental stock with average monthly rent of £706.
Commenting on the data, Fleet Mortgages chief commercial officer Steve Cox (pictured above), said this reflected a “greater degree of positivity” in the BTL market.
“Our Rental Barometer reflects that optimism over the last quarter of 2024, with average rental yields – on the whole – continuing to improve, albeit at a slightly slower rate, but also in terms of Fleet’s figures for average monthly rents, average rates, average loan sizes, rental cover, and application numbers for property purchases,” said Steve.
“In our view, all of this points to a more positive market for buy-to-let in 2025, especially if we see rates fall steadily, as anticipated, while at the same time, tenant demand remains strong, while the supply of properties in the private rental sector is still not enough to meet this demand.”
