The UK’s buy-to-let market continues to deliver robust returns for investors, with average rental yields rising to 7.11% in April—marking the highest level recorded since 2011, according to new figures from Paragon Bank.
This surpasses the previous recent peak of 6.94% recorded in Q4 2024, and brings yields in line with levels last seen in February 2011, when they reached 7.12%.
The data shows a clear upward trend, with yields recovering steadily from a low point of 4.91% in May 2017. Regional differences remain significant: Wales leads the way with yields averaging 8.43%, closely followed by Yorkshire and the Humber (7.97%) and the North of England (7.94%). In contrast, Greater London lags behind at 5.78%, with the South East (6.57%) and Scotland (7.46%) also returning below-average figures.
Property type is also a key driver of performance. Houses in multiple occupation (HMOs) are generating particularly strong returns, with average yields climbing to 8.5%—up from 8.41% at the end of 2024.
The report highlights a 40 basis point year-on-year increase in the rental income to property value ratio on buy-to-let purchases and remortgages. This growth is attributed to a combination of softening house price inflation and continued rental growth, driven by high tenant demand and a limited supply of rental stock.
Commenting on the findings, Russell Anderson, Commercial Director of Mortgages at Paragon Bank, noted:
“These latest figures reinforce the strength of the buy-to-let sector, even in the face of broader economic uncertainty. Investors are seeing consistent returns, particularly when focusing on high-yield opportunities such as HMOs or targeting affordable regions with strong rental demand.”
At Signature Specialist Finance, we understand the evolving needs of property investors and landlords. Whether you’re expanding your portfolio, refinancing, or exploring niche opportunities such as HMOs or multi-unit blocks, we’re here to provide the specialist support and tailored solutions to help you succeed.
Source: Mortgage Solutions
