According to a big bank’s research, rental yields for landlords have soared to their highest since 2014.
The latest report shows that landlords achieved an average rental yield of 6.3% in the second quarter of this year.
This is a big jump from the 15-year low of 5.2% in the first half of 2023.
It’s the highest yield since the third quarter of 2014, with only the 6.7% yield in Q3 of 2012 being higher.
Health Check for the Lettings Business
The bank’s mortgage boss mentioned that rental yields are a key sign of how well the lettings business is doing.
It’s great to see them hit a 10-year high after last year’s dip.
Larger portfolio landlords, including those with Houses in Multiple Occupation (HMOs) and properties in limited companies, are seeing higher yields.
These features are usually linked with more professional landlords.
He also pointed out that, whether you’re a newbie or a pro, the main takeaway is that good strategies lead to success.
People often say buy-to-let isn’t worth it anymore, but this data shows that with the right approach, you can overcome even tough times.
Our industry can educate customers and help them run successful businesses, boosting the UK’s housing supply.
Rental Yields: Key Insights from Nearly 800 Landlords
A deep dive into the data, gathered from nearly 800 landlords, shows some interesting trends.
There’s a clear link between portfolio size and yields, with those managing 11 or more properties reporting average yields of 6.9%.
Landlords holding all properties within limited companies also saw yields of 6.9%.
The type of property matters too, with HMOs delivering yields of 7.2%.
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