Answers · UK 2025/26
What is a good rental yield in the UK?
A "good" gross rental yield in the UK is typically 5–8%. Net yield (after costs) of 4–6% is healthy. High-yield areas include parts of the North East and North West (often 7–10% gross); low-yield areas include central London and the South East (often 2–4%).
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Rental yield = (annual rent ÷ property purchase price) × 100. Gross yield ignores costs; net yield deducts mortgage interest, letting agent fees (8–15% of rent), insurance, maintenance, voids, ground rent/service charge (for flats), and any management fees. Typical UK gross yields 2025: central London 2–4%, outer London 4–5%, South East 4–6%, Midlands 5–7%, North West 6–9% (Liverpool, Burnley, Manchester suburbs), North East 7–10% (Middlesbrough, Sunderland), Scotland 5–8%, Wales 5–7%, Northern Ireland 6–8%. A property worth £200,000 rented at £1,000/month: gross yield 6.0% (£12,000 / £200,000). After 30% costs (typical), net yield ~4.2%. Capital growth varies inversely — high-yield areas often see lower growth. Tax considerations: Section 24 caps mortgage interest relief at 20% for higher-rate landlords (so model the cash-flow carefully), and CGT applies on sale. Use the Rental Yield calculator to compare property options.
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This answer is informational only and does not constitute financial, tax or legal advice. Figures are for the 2025/26 UK tax year. See our methodology and sources.