rental yield map graphic
CategoriesInvestor Advice Yield Map

What a difference a year makes!

Following our first buy-to-let yield research project in 2022, we’ve dug even deeper this year to bring you the latest insights into the world of property investment. Our sample size of postcodes in 2023 is almost double that of 2022 – 2,468 vs. 1,350 – which puts us in a position to offer an even more detailed analysis of the current state of play across the UK.

Right now, many landlords are carefully gauging their position in the market and keeping their options open. Inflation, wage stagnation and rate rises are all having an impact on the sentiment around investment. Meanwhile, the soaring property prices we’ve seen over the past few years are starting to slow down.

So, for new and experienced investors alike, it’s never been more important to weigh up the facts before choosing the right area for your next investment. This year’s report should help you do just that.

UK Regions By Yield

Region Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
Scotland £206,649 23.51% £922 5.70%
North East £227,892 20.71% £782 4.72%
Wales £265,444 36.62% £919 4.68%
North West £239,021 28.48% £821 4.38%
West Midlands £299,281 28.03% £923 4.11%
East Midlands £250,552 27.45% £790 4.10%
Greater London £597,917 14.47% £1,914 4.00%
South East £456,964 21.65% £1,351 3.80%
South West £378,791 28.51% £1,121 3.78%
East of England £408,430 22.09% £1,189 3.65%

The breadth of our data this year has allowed us to pull together this snapshot of rental yields by UK region. Scotland (5.7%) is currently offering a far greater yield than any other region, almost 1% more than the North East (4.72%) in second place.

Wales and the North West still offer good opportunities, far more so than the East of England and South West which rank lowest in terms of yield. That said, average house prices in the South West (£378,791) are considerably more accessible than the South East (£456,964) which is a key factor for many investors.

Note: Unfortunately there is no data available for Northern Ireland.

Top 10 Towns & Cities By Yield

Town/City Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
Glasgow £166,041 27.17% £968 6.91%
Middlesbrough £151,256 15.17% £601 6.75%
Dundee £172,958 27.80% £848 6.57%
Preston £177,171 15.00% £924 6.30%
Swansea £233,783 34.57% £1,274 6.10%
Aberdeen £169,770 -9.30% £742 6.03%
Nottingham £232,014 27.86% £1,096 5.94%
Southampton £263,503 17.50% £1,263 5.85%
Newcastle £201,288 13.33% £935 5.81%
Salford £221,114 42.33% £1,069 5.76%

A breakdown of rental yields by city offers similar reading, as you’d expect, with locations in Scotland, the North East and North West dominating the top positions.

At 6.91%, Glasgow is clearly an area that many investors will be considering over the coming years considering its large student population, famed nightlife and excellent transport links. Looking further south, Middlesbrough and Preston are also enticing prospects at the moment in terms of buy-to-let potential.

Top 10 Postcodes In The UK By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 BD1 Bradford £64,805 4% £575 10.70%
2 LS2 Leeds £147,827 49% £1,238 10.00%
3 M14 Manchester £222,830 40% £1,765 9.50%
4 LS4 Leeds £213,669 31% £1,658 9.30%
5 NG7 Nottingham £196,583 34% £1,423 8.70%
6 CF37 Rhondda Cynon Taf £155,836 36% £1,114 8.60%
7 B29 Birmingham £268,335 21% £1,916 8.60%
8 SR1 Sunderland £75,888 56% £536 8.50%
9 TS3 Middlesbrough £85,440 25% £604 8.50%
10 SA1 Swansea £153,226 17% £1,074 8.40%

Comparing this year’s data with our findings from 2022, BD1 in Bradford has moved from third to first place for the most lucrative rental yield anywhere in the UK – at a whopping 10.7%.

Last year’s top spot, NG7 in Nottingham, has been knocked down to fifth place due to rental yield dropping from 11.3% in 2022 to 8.7% in 2023.

M14 in Manchester continues to perform strongly, offering a yield of 9.5% in 2023, which is only marginally less than the 10.1% offered in 2022.

For those looking at the North East, TS3 in Middlesbrough and SR1 in Sunderland are both areas to consider, offering an identical yield of 8.5%.

UK rental yield map for 2023

Worst 10 Postcodes In The UK By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 CM4 Brentwood £747,589 27% £1,304 2.10%
2 B93 Solihull £612,283 26% £1,121 2.20%
3 HP4 Dacorum £724,304 10% £1,403 2.30%
4 GL6 Stroud £508,422 36% £984 2.30%
5 TQ6 South Hams £457,968 41% £892 2.30%
6 W1 Westminster £2,256,107 -15% £4,421 2.40%
7 CV9 North Warwickshire £368,372 16% £732 2.40%
8 W8 Kensington and Chelsea £2,013,838 -9% £4,139 2.50%
9 CB11 Uttlesford £619,247 11% £1,314 2.50%
10 L39 West Lancashire £356,893 18% £734 2.50%

CM4 in Brentwood, Chelmsford has jumped from fifth place last year to take the crown (or should we say the wooden spoon) as the UK’s worst postcode for rental yield in 2023; however, the yield remains almost exactly the same as last year: 2.2% vs. 2.1%.

B93 in Solihull also continues to perform poorly, moving from sixth place to second place this year whilst maintaining exactly the same yield: 2.2%.

Overall, it’s clear that rental yields have improved slightly across the board, with no postcode falling below 2% this year. There are also positive signs for last year’s worst-performing postcodes – GU10 in Guildford and HP9 in Hemel Hempstead – both of which no longer feature in the top 10 list in 2023.

London

Top 10 Postcodes By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 SE28 Greenwich £320,584 10% £1,627 6.10%
2 RM19 Thurrock £232,934 14% £1,153 5.90%
3 NW8 Camden £1,112,235 -5% £5,396 5.80%
4 IG11 Barking and Dagenham £347,762 7% £1,637 5.60%
5 SE17 Southwark £525,337 -1% £2,439 5.60%
6 SE18 Greenwich £416,921 6% £1,881 5.40%
7 E16 Newham £456,118 -1% £2,071 5.40%
8 E3 Tower Hamlets £440,591 -3% £1,962 5.30%
9 E15 Newham £425,491 22% £1,832 5.20%
10 E6 Newham £427,778 20% £1,840 5.20%

Worst 10 Postcodes By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 W1 Westminster £2,256,107 -15% £4,421 2.40%
2 W8 Kensington and Chelsea £2,013,838 -9% £4,139 2.50%
3 N10 Haringey £797,653 11% £1,754 2.60%
4 IG5 Redbridge £584,143 18% £1,296 2.70%
5 WD4 Dacorum £617,215 6% £1,429 2.80%
6 N6 Camden £865,755 9% £2,028 2.80%
7 SW3 Kensington and Chelsea £1,602,417 10% £3,695 2.80%
8 WD7 Hertsmere £875,278 28% £2,077 2.80%
9 SW7 Kensington and Chelsea £2,089,942 7% £4,970 2.90%
10 KT20 Reigate and Banstead £705,589 40% £1,734 2.90%

Despite the fact that London as a region will likely never offer the best possible rental yields for buy-to-let landlords, the charm of the city and sheer scale of demand are still enough to make it a hotspot for UK investment.

That said, individual postcodes are performing much better than last year. The top spot in 2023 – SE28 in Greenwich (6.1%) – offers almost 1% more in yield compared with last year’s winner – DA9 in Dartford. Thurrock, Camden and Barking all offer good opportunities too.

At the other end of the spectrum, W1 in Westminster (2.4%) currently offers the worst value for money on average in London from a buy-to-let perspective; however, it still boasts an improvement on last year’s results where it came in at 2.3%. Property prices in W1 have also rocketed by more than £200,000 over the past 12 months, a staggering rise in such a short time.

The North

Top 10 Postcodes By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 BD1 Bradford £64,805 4% £575 10.70%
2 LS2 Leeds £147,827 49% £1,238 10.00%
3 M14 Manchester £222,830 40% £1,765 9.50%
4 LS4 Leeds £213,669 31% £1,658 9.30%
5 SR1 Sunderland £75,888 56% £536 8.50%
6 TS3 Middlesbrough £85,440 25% £604 8.50%
7 NE6 Newcastle £153,962 21% £1,034 8.10%
8 NE4 Newcastle £139,571 8% £912 7.80%
9 LS6 Leeds £265,156 29% £1,700 7.70%
10 TS1 Middlesbrough £81,633 31% £520 7.60%

Worst 10 Postcodes By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 L39 West Lancashire £356,893 18% £734 2.50%
2 CH48 Wirral £419,380 40% £889 2.50%
3 WA16 Cheshire East £562,609 24% £1,241 2.60%
4 CW6 Cheshire West and Chester £569,385 42% £1,230 2.60%
5 LS29 Bradford £450,336 24% £1,017 2.70%
6 DL10 North Yorkshire £297,044 31% £679 2.70%
7 HG4 Ripon £338,054 23% £789 2.80%
8 YO15 East Riding of Yorkshire £209,530 24% £482 2.80%
9 CH64 Cheshire West and Chester £342,772 46% £796 2.80%
10 YO7 North Yorkshire £307,246 14% £740 2.90%

As we’ve discussed, BD1 in Bradford remains at the top of the tree for best-performing yields anywhere in the UK.

Both LS2 and LS4 in Leeds have risen sharply up the ranking since 2022, both offering nearly 2% more in yield now compared with last year. Like Glasgow, Leeds is another incredibly popular area for investment due to its huge student population and nightlife.

Positions 5-10 are dominated by postcodes in the North East, which is a similar story to 2022. NE6 and NE4 are two areas to look into if you’re considering investing in Newcastle.

Wales

Top 10 Postcodes By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 CF37 Rhondda Cynon Taf £155,836 36% £1,114 8.60%
2 SA1 Swansea £153,226 17% £1,074 8.40%
3 CF43 Rhondda Cynon Taf £101,086 65% £635 7.50%
4 CF24 Cardiff £223,353 34% £1,279 6.90%
5 CF40 Rhondda Cynon Taf £115,503 56% £656 6.80%
6 CF10 Cardiff £195,061 6% £1,056 6.50%
7 NP13 Blaenau Gwent £117,699 66% £632 6.40%
8 SA2 Swansea £276,000 32% £1,436 6.20%
9 LL57 Gwynedd £208,762 6% £950 5.50%
10 NP11 Caerphilly £174,863 43% £766 5.30%

Worst 10 Postcodes By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 NP25 Monmouthshire £444,470 25% £992 2.70%
2 CF71 Vale of Glamorgan £504,519 44% £1,198 2.80%
3 SY3 Shropshire £332,720 23% £808 2.90%
4 SY5 Shropshire £392,105 29% £961 2.90%
5 SY11 Shropshire £240,551 30% £607 3.00%
6 SY4 Shropshire £344,088 34% £864 3.00%
7 SY2 Shropshire £307,831 26% £827 3.20%
8 NP16 Monmouthshire £346,896 30% £964 3.30%
9 CF64 Vale of Glamorgan £378,608 28% £1,122 3.60%
10 SA31 Carmarthenshire £231,902 33% £692 3.60%

Wales has been attracting more and more investment in recent years – and looking at postcodes such as CF37 and CF43 in Rhondda Cynon Taf and SA1 in Swansea, it’s easy to see why. Both areas offer around an 8.5% rental yield and relatively low barriers to entry considering the average property price is roughly £150,000.

In terms of worst postcodes for buy-to-let yield, Shropshire dominates the top 10 with yields sitting between 2.8-3.2%. CF71 in the Vale of Glamorgan has also seen a huge 44% increase in property prices over the past five years, with the average house price now reaching over £500,000.

Scotland

Top 10 Postcodes By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 AB24 Aberdeen £104,463 -20% £715 8.20%
2 G32 Glasgow £107,483 17% £728 8.10%
3 G5 Glasgow £149,384 34% £982 7.90%
4 G67 North Lanarkshire £96,882 28% £620 7.70%
5 G1 Glasgow £160,641 8% £1,036 7.70%
6 G31 Glasgow £143,880 43% £902 7.50%
7 G20 Glasgow £157,698 24% £963 7.30%
8 G42 Glasgow £143,124 64% £856 7.20%
9 G11 Glasgow £181,025 10% £1,082 7.20%
10 AB11 Aberdeen £100,467 -14% £602 7.20%

Worst 10 Postcodes By Yield

Position Postcode Area Avg Property Price 5 Yr Price Change Avg Monthly Rent Avg Rental Yield
1 ML11 South Lanarkshire £190,486 25% £528 3.30%
2 FK2 Falkirk £186,473 26% £595 3.80%
3 EH54 West Lothian £239,592 42% £776 3.90%
4 AB15 Aberdeen £315,945 -6% £1,050 4.00%
5 IV2 Highland £226,207 10% £764 4.10%
6 AB21 Aberdeen £223,940 11% £761 4.10%
7 KA7 South Ayrshire £252,695 17% £859 4.10%
8 G66 East Dunbartonshire £209,216 5% £733 4.20%
9 G77 East Renfrewshire £330,327 3% £1,175 4.30%
10 EH14 Edinburgh £277,756 18% £1,014 4.40%

Glasgow postcodes account for 7 of the top 10 best yields in Scotland, so it’s easy to see why investors are beginning to flock north of the border in search of exceptional deals.

Compared with the rest of the UK, the worst yield column certainly isn’t as bad either. Landlords can still secure an average return of 4.4% in Edinburgh’s EH14 for instance.

Takeaways

It’s clear that Scotland and the North East are currently offering the best opportunities for investors on average. We certainly expect to see more investors making the trip up to Glasgow this year. The fact the city has such a distinct culture, large student population, thriving social scene and close proximity to Edinburgh are all reasons why it’s our top pick for UK buy-to-let landlords in 2023.

The North East still edges the North West for great yield potential, though there are still fantastic deals to be found in Manchester, Leeds and Nottingham. Wales is another promising location, particularly postcodes in the Swansea area.

We hope you’ve found this guide useful, particularly at a time of such uncertainty within the market. If you’d like to discuss your buy-to-let property investment plans for 2023 or 2024 with one of our advisors then we’d be happy to talk through your best options and answer any questions you have. Use the form below to submit your details and we’ll be in touch!

    About the data

    We collected and analysed property market data from 2,468 postcode areas across England, Scotland and Wales.

    Data source: propertydata.co.uk

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