Cardiff has retained its place as the top rental market in the UK, according to research from Paragon.
Paragon analysed the UK’s leading BTL hotspots, based on completions throughout 2025, and identified the Welsh Capital as the most attractive.
Buyers have flocked to the CF24 post code, where the average rental yield is 9.06%.
Cardiff was named the top BTL market in 2024 by Paragon, where landlords can access an average rental yield of 8.7%.
The latest research has put Nottingham’s NG7 and Manchester’s M14 as the second and third ranked postcodes, respectively.
NG7 provided an average rental yield of 8.94% while M14 generated 8.28%.
In 2024, Birmingham’s B29 and Plymouth’s PL24 took these spots but waning demand has seen them slip down to seventh and 10th place.
However, on a yield basis alone, Plymouth’s PL4 delivered the best returns at 9.78%. This was followed by Gloucester’s GL1 at 9.66% and Hull’s HU5 at 9.01%.
Seven of the top 10 all delivered yields in excess of 8%.
“This year’s rankings show a clear and enduring trend; the strongest BTL markets are those supported by large student populations and a solid flow of young renters, supplemented by other sources of tenant demand, such as hospitals or employment centres,” said Louisa Sedgwick, managing director of mortgages at Paragon Bank.
“From Cardiff and Nottingham to Manchester and Leeds, these hotspots highlight how investor strategy has become more focused and data?driven.
“Rather than being deterred by the wider economic environment, landlords are choosing resilient, high?performing rental markets that continue to deliver strong returns.”
