UK Buy-to-Let Yields Reach Highest Levels in Over a Decade

UK property investors are seeing the strongest average rental yields in over 14 years, according to newly released data from Paragon Bank. As of April 2025, average yields across buy-to-let properties hit 7.11%, marking the highest point since February 2011.

The surge in rental yields is driven by a combination of sustained tenant demand and a limited supply of rental properties, against a backdrop of stabilising property prices. It continues a consistent upward trend from the market low of 4.91% in May 2017.

What the Numbers Show

Paragon Bank's lending data reveals that:

• Yields in April 2025 increased from 6.94% at the end of Q4 2024
• This marks a 40 basis point rise year-on-year
• Rental yields have now seen multiple monthly increases since the start of 2025

According to Russell Anderson, Commercial Director of Mortgages at Paragon Bank:

"These figures offer tangible evidence that buy-to-let continues to offer strong returns for investors, especially those who focus on high-return property types like HMOs or invest in high-demand, lower-cost regions."

Regional Breakdown: Where Yields Are Highest

Some regions stand out for outperforming the national average, particularly Wales and areas in Northern England. In contrast, landlords in Greater London continue to see the lowest rental yields, despite a slight uptick.

These figures highlight the value proposition in regional UK markets, particularly for overseas and expat investors seeking strong returns from rental income.

Why This Matters for Overseas Investors

For investors at home and abroad, these figures underline the long-term strength and resilience of the UK rental market. With average yields now at a 14-year high, the buy-to-let sector continues to offer:

• Strong income potential relative to market volatility
• Attractive returns in regional areas with lower entry costs
• Opportunities for strategic expansion, especially for experienced landlords and portfolio investors

For international investors, particularly from the Middle East and Asia, the opportunity to access double-digit yielding assets in regions like Wales, Yorkshire, and the North of England adds further weight to the UK’s appeal.