Average rental yield has reached 6.5%, equalling the 10-year high achieved in Q3 2024, according to landlord research by Pegasus Insight.
The latest landlord trends report revealed that landlords in the North West, North East and East Midlands have reported the strongest returns, all averaging above 7%, while yields in London remain the lowest at 6.1%.
Some 87% of landlords said they are currently making a profit, with 21% describing this as a ‘large’ profit and 66% a ‘small’ profit.
Only 5% report any form of loss.
Pegasus Insights highlighted a backdrop of “looming legislative change” with only 14% of landlords fully aware of the Renters’ Rights Bill, which the researcher claims is likely to influence portfolio strategies.
Bethan Cooke, director at Pegasus Insight (pictured above), commented: “Yields at a 10-year high are a clear signal of the enduring strength of the private rented sector.
“The fact that almost nine in 10 landlords are still making a profit demonstrates the sector’s ability to weather economic and policy storms.
“At the same time, the policy landscape is far from settled. The Renters’ Rights Bill represents the most significant set of changes in a generation. While intended to protect tenants, it is also adding to landlord uncertainty.
“Our data shows landlords remain committed, but for many the coming 12 months will be a crucial period to review portfolios, financing and business models in light of what’s ahead.”
