Revealed: Rental Yields Across Regions in England and Wales
An analysis of Paragon Bank lending data has revealed that landlords in the North East, North West, and Yorkshire & Humber achieve the highest rental yields of any region in England.
Landlords in the North East achieve the highest average yields at 8.13%, topping Paragon Bank's regional rental yield table, which is based on the lender’s own data. Wales follows closely with average returns of 8.07%, while the North West ranks third with buy-to-let properties yielding 7.84%.
Yorkshire & Humber, another northern region, also exceeds the average yield for England, Scotland, and Wales, which stands at 7.17%. According to Paragon's analysis, landlords in Yorkshire & Humber can achieve yields of 7.54%, placing the region fourth in Paragon’s rental returns rankings.
In addition to strong rental demand across the UK, a key factor driving the high yield performance in the North is the relative affordability of property.
According to a report from the Office for National Statistics, the most affordable local authorities in 2023 were located in the North East, North West, and Yorkshire & Humber.
The report calculates affordability by dividing house prices by gross annual workplace-based earnings. In 2023, homes bought in England and Wales were priced at 8.3 and 6.1 times the annual salary of a full-time employee, respectively. In the three northern regions of England, only four local authorities had ratios exceeding eight.
The North East emerged as the most affordable region, with more local authorities having affordability ratios below five than above. In contrast, London was the least affordable, with eight out of 10 local authorities showing ratios above 12.
Louisa Sedgwick, Managing Director of Mortgages at Paragon Bank, says: “Our latest report uses industry data to show that, over the past decade, the North of England has overtaken the South in terms of the proportion of buy-to-let property purchases.
"One key reason for the region’s growing appeal to landlords is the potential for strong investment returns. Demand for rental properties remains high across the UK, including in the North, where property is often much more affordable than in southern regions. This allows landlords to invest with confidence, knowing they can achieve above-average yields."