A new study has revealed the top 10 UK areas with the greatest rental yield making them ideal for a buy-to-let.
Confused.com has analysed the average rental income by the average house price of different areas in the UK to reveal the areas with the highest rental yield.
Areas in the UK with the greatest rental yield:
Rank |
Local authority |
Average rental yield |
Average house price |
Average rent |
1 |
Glasgow |
5.65% |
£196,618 |
£750 |
2 |
Aberdeen |
5.47% |
£142,777 |
£617 |
3 |
Clackmannanshire |
5.31% |
£139,551 |
£636 |
4 |
Falkirk |
5.31% |
£345,574 |
£1,295 |
5 |
Midlothian |
5.26% |
£168,415 |
£793 |
6 |
Dundee |
5.19% |
£226,844 |
£900 |
7 |
Burnley |
5.15% |
£163,327 |
£617 |
8 |
West Dunbartonshire |
5.09% |
£173,049 |
£625 |
9 |
Hyndburn |
5.03% |
£131,384 |
£550 |
10 |
Blackpool |
5.02% |
£188,750 |
£725 |
The area in the UK with the greatest rental yield is Glasgow at 5.65%. Rental yield is the most crucial factor to consider when buying a buy-to-let property. It refers to the rental income as a percentage of the purchase price. In Scotland’s biggest city, the average property price is £168,415, with an average rent of £793, for a yield of 5.56%. Compared to other major UK cities, property in Glasgow is relatively affordable, and rental demand remains strong partly due to a large student population.
The second area with the highest rental yield is Aberdeen, with average house prices of £142,777 and an average rental income of £617, which gives the area a rental yield of 5.47%.
Third on the list is Clackmannanshire, with average house prices of £139,551 and an average rent income of £636, giving a rental yield of 5.31%.
The areas in the UK with the lowest rental yield:
Rank |
Local authority |
Average rental yield |
Average house price |
Average rent |
1 |
East Renfrewshire |
2.09% |
£293,102 |
£511 |
2 |
West Northamptonshire |
2.13% |
£295,459 |
£525 |
3 |
Monmouthshire |
2.15% |
£367,223 |
£657 |
4 |
Ceredigion |
2.29% |
£247,368 |
£472 |
5 |
Powys |
2.30% |
£239,130 |
£459 |
The area in the UK with the lowest rental yield is East Renfrewshire at just 2.09%. With average house prices of £293,102 and an average rent of £511.
This research is one of the factors assessed in Confused.com’s study into the best places to rent out property in the UK. Overall the study found that Newcastle upon Tyne was the best area to rent out property.