09 Jun 2021

Manchester had the best rental yields between 2015 and 2020, averaging at 5.5% per year over that time, analysis has revealed.

The second-best hotspot between 2015 and 2020 is Sunderland (5.4%), followed by Nottingham (5.3%) and Newcastle (5.2%).

In 2020 the best area for rental yields was Newcastle, with yearly returns of 5.7%.

Returns stood at 5.3% in Manchester in 2020, highlighting how the city has been a very consistent one for investors in recent years.

Daniel Jackson, sales director at Sequre Property Investment, which undertook the analysis, said: “The increasing cost of property coupled with current uncertainty within the rental market can make investing into the rental market a daunting business. However, it remains a lucrative venture for those who know where to invest and what to invest in.

“The key is to know your market and to appreciate that property investment should be undertaken with a long-term view, rather than a smash and grab mentality. The historic market health of a given location can provide you with good insight in this respect but top-line rental yields can only take you so far.

“Utilising the knowledge of those in the sector is the best way to maximise your endeavours, whether it be through a tailored investment to suit your individual circumstances, the ability to access bulk deals that can minimise the initial cost of investing or even access to off-market opportunities that aren’t open to the average buy-to-let investor. All of these approaches can see you secure a far higher yield in any location when compared to the general market.”

Cambridge has seen the lowest average rental yield since 2015 at just 3.2%, while Bournemouth is the only other city to also slip below the 4% mark.

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