Top 14 Cities With Good Rental Yields in the UK (2024)
  • November 20th, 2023

Top 14 Cities With Good Rental Yields in the UK (2024)

Top 14 Cities With Good Rental Yields in the UK (2024)

As an investor looking to capitalise on the UK property market, you want to ensure maximum returns. One of the best ways to determine the profit potential of a rental property is by calculating its rental yield. And with rents on the rise across the UK, now is an opportune time to analyse cities and regions with the highest yields to find the best investments. By recognising those UK cities with good rental yields in the UK—across England, Wales, Scotland and Northern Ireland—you can make a data-driven decision on where to invest for the best returns.

How to Work Out Yield in Property: Calculations & Relevance

Rental yield refers to the annual return you can achieve by renting out a property, expressed as a percentage of the property’s value. Calculating this metric is a key step in making a successful property investment.

how to work out yield in property image

Here’s how to work out yield in property:

Method 1: (Annual Rent / Property Value) x 100%

Divide the annual rent by the property’s current market value.

For example, if you receive £24,000 in rent per year for a property worth £300,000, the rental yield is 8%.

That is: (£24,000 / £300,000) x 100% = 8%

Method 2: [(Monthly Rent x 12) / Property Value] x 100%

Multiply the monthly rent by 12 to get the annual rent. Then, divide the annual rent by the property value and multiply the result by 100%.

Using the same example: £2,000 monthly rent x 12 = £24,000.

The rental yield is: (£24,000 / £300,000) x 100% = 8%

Method 3: [((Monthly Rent x 12) - Expenses) / Property Value] x 100%

Factor in expenses like taxes, insurance, and maintenance to obtain the net annual rent. Divide the net rent by the property value and multiply by 100%

If the monthly expenses are £200, the annual equivalent is: £200 x 12 = £2,400

The net annual rent is: £24,000 - £2,400 = £21,600

The rental yield is: (£21,600 / £300,000) x 100% = 7.2%

Why Is Rental Yield Important?

  • It allows investors to compare the potential return of different properties to determine which is the most profitable investment.
  • It also indicates the demand and potential for rent increases.

A higher yield usually means higher demand and greater potential for growth. Monitoring the rental yield over time helps determine if your property value is increasing adequately based on market rents.

In summary, calculating and tracking your rental yield is key to maximising your returns as a property investor. Focusing on cities and properties with the highest yields, like Birmingham, Manchester, Nottingham, etc., will set you up for the best long-term success.

Overview of Rental Yields in England for 2024

England rental yield projections for the year 2024 indicate a positive trend. The North of England appears to be outperforming the South, with average yields around 7.4%. Top performers in the North include cities like Manchester and Liverpool, which have become hotspots for investors.

On the other hand, the South (including London and the South East), although showing some improvement, continues to yield lower returns due to the high property prices in these areas. The average yield here is around 5.2%. Generally, there is a good rental yield in the UK, with an average rental yield of about 5%, ranking the country as one of the best places to invest in the world.

5 Top Cities for Rental Yields in England













According to our analyses of property markets across England, 5 top cities with the highest rental yields in 2024 include:

1. Manchester

The rental market in Manchester continues to thrive with strong demand. The city’s year-on-year rental growth as of June 2023 has hit a notable 13% with an average rental yield of 5–9%, the highest figure across England outside of London. Notably, this is approximately 3% higher than the North West as a whole, demonstrating Manchester’s robust performance in the rental sector.

Manchester Image

However, it’s worth noting that the supply of available rentals is tightening, with the city witnessing the lowest number of lets in February 2023 since 2020. This could be contributing to the increase in rental prices, which has soared by a significant 19.6% over the last 12 months leading up to June 2023.

New Manchester property developments and infrastructural enhancements continue to attract more residents and businesses, which, in turn, fuels the rental market’s growth. Yet, with the dwindling supply of rentals, the market dynamics may continue to evolve.

2. Birmingham

Birmingham, one of the UK’s fastest-growing cities, continues to present an attractive proposition for property investors, especially in the rental market. As of September 2023, the city’s rental yields have risen slightly to an average of 6.3%, driven by affordable property prices and consistent demand.

A key demographic shift has been observed in Birmingham’s rental market. More young professionals and families are choosing to rent in the city, mainly due to the affordability of properties compared to cities like London. This has led to an almost 10% increase in rental prices between June 2022 and June 2023.

good rental yields in the UK Birmingham image

Adding to its appeal, Birmingham’s economy remains diverse and robust, with a vibrant mix of sectors, including financial services, digital technology, and creative industries. This economic dynamism, combined with major Birmingham property developments, is expected to attract more people to the city, further driving rental demand.

3. Nottingham

Nottingham, a centrally located city with a diverse economy, remains one of the best places to invest in property in the UK. As of October 2023, average rental yields in Nottingham have risen to 6%, reflecting the city’s affordability and consistent rental demand.

Nottingham’s student population, a significant contributor to rental demand, remains robust. The city’s two universities—The University of Nottingham and Nottingham Trent University—have a combined student population of over 60,000 (1, 2), with steady year-on-year increases. This, coupled with the influx of young professionals, particularly in the growing tech and digital sectors, has driven the demand for rentals.

good rental yields in the UK Nottingham image

The city’s central location and connectivity, along with its diverse economy spanning sectors like healthcare, manufacturing, and retail, further support its property market. With new Nottingham property developments and infrastructure improvements in the pipeline, the city’s rental market is poised for steady growth.

4. Liverpool

Liverpool, a city bursting with cultural vibrance and home to a bustling nightlife, is a strong contender in the UK rental market. As of October 2023, the city maintains an impressive average rental yield of 6.2%, an increase from the previous year’s figure driven by its affordable property prices.

A significant factor contributing to the city’s consistent rental demand is its thriving student population. Liverpool’s three universities—The University of Liverpool, Liverpool John Moores University, and Liverpool Hope University—host a combined student population exceeding 70,000. This, coupled with a steady increase in student numbers this year, has led to a surge in demand for rental properties.

Liverpool England Image

Furthermore, the city’s lively cultural scene and nightlife attract a diverse range of residents, which has contributed to an 8% increase in rental prices over the past year. Ongoing Liverpool property developments, such as Tobacco Warehouse, Liverpool Waters and the Knowledge Quarter, are expected to further bolster the rental market.

5. Leeds

Leeds, a city known for its vibrant student population and thriving professional industries, continues to be a strong contender in the rental market. As of September 2023, rental yields in Leeds hover around 6.3%, a slight increase from the previously stated figure. This is driven by the city’s relatively lower property prices and a noticeable shortage of available rentals.

The 60,000 student population in Leeds, which contributes significantly to the rental demand, further results in the shortage of rental properties. Similarly, the influx of professionals, particularly in sectors like financial services and digital technologies, has boosted the demand for rentals.

Leeds England Map Image

Moreover, Leeds has seen an 8% rise in rental prices over the past year, likely due to this increased demand and limited supply. With new developments and infrastructure projects underway, the city’s rental market is expected to maintain its steady growth.

Overview of Rental Yields in Wales for 2024

As we approach 2024, the rental market in Wales continues to offer attractive opportunities for investors. This is bolstered by the rising rental prices in Wales’ major cities like Cardiff, Swansea, and Newport, which has contributed significantly to this positive forecast.

Wales England Image

It’s important to note that rents across the UK are forecasted to rise 4x faster than house prices between the end of 2022 and the end of 2026, potentially leading to a good rental yield in this UK region.

3 Top Cities for Rental Yields in Wales









Here are 3 top cities for the best rental yields in Wales:

6. Cardiff

Cardiff, the capital city of Wales, provides some of the highest rental yields. Currently, the average rental yield for buy-to-let properties in Cardiff is 7.61%. Investors can expect to achieve higher yields by renting to students of Cardiff University. One- or two-bedroom flats near the university campus usually command higher rent.

7. Swansea

Swansea, Wales’s second-largest city, also offers attractive rental yields for investors. The city is home to Swansea University, which provides a steady stream of student tenants. Buy-to-let yields in Swansea currently stand at 5.27%, with the potential to increase. For the best returns, target flats or houses within walking distance of the university.

8. Newport

Newport, the third largest city in Wales, provides lower but more stable rental yields. The city has a diverse economy, with many large employers providing employment opportunities. Rental yields for standard two- or three-bedroom houses in Newport are around 5.12% per annum. Investors seeking higher returns can consider multi-unit properties like semi-detached houses, which often translate to yields of up to 6% due to higher rent potential.

Overview of Rental Yields in Scotland for 2024

In 2024, Scotland offers property investors good rental yields in the UK, especially in its largest cities. Based on our analysis, Scottish rental yields currently average around 6% nationally. However, yields in major cities like Edinburgh and Glasgow are significantly higher at over 7% due to strong tenant demand and limited supply.

Scotland map image

3 Top Cities for Rental Yields in Scotland









Here are 3 top picks for the best rental yields in Scotland:

9. Edinburgh

Scotland’s capital city, Edinburgh, is forecast to provide one of the highest average rental yields in Scotland in 2024 — an average of 4–6%, with some areas boasting rates of up to 7.5%. House prices in Edinburgh continue to rise due to its popularity and limited housing stock, but rents have risen at a faster pace, pushing up yields for buy-to-let investors. Popular areas of the city for renters include Leith, Newington, and Bruntsfield, where rental yields have remained high due to high demand from students and young professionals.

10. Glasgow

Home to Scotland’s largest university, the University of Glasgow, this city provides attractive yields, especially in the city centre and West End. The current average rental yield in the city is about 6.73%, with certain areas experiencing annual returns of up to 8%. Yields are higher in areas popular with students like Hillhead, Partick, and Finnieston, where purpose-built student accommodations and tenement flats provide highly profitable returns. Likewise, the completion of major infrastructure projects has improved connectivity and encouraged businesses to relocate to Glasgow, boosting the city’s economy and tenant demand.

11. Aberdeen

Aberdeen, Scotland’s third-largest city, currently provides higher than average rental yields for Scotland at around 5.5%. Historically an important centre for fishing and shipping, Aberdeen now has a strong economy focused on the oil industry and renewable energy. While house prices and rents declined in recent years due to the oil price crash, we expect both to recover and rise over the next few years as the oil market stabilises, improving rental yields for investors. Popular, high-yield areas for renters include the city centre, Old Aberdeen, and Hazlehead.

Overview of Rental Yields in Northern Ireland for 2024

In Northern Ireland, rental yields have increased significantly over the past several years due to a shortage in housing supply paired with strong demand from tenants. According to recent statistics, the average rental yield for buy-to-let properties in Northern Ireland reached 6.2% in 2023, identifying this region as one of the few places offering good rental yields in the UK.

Northern Ireland

3 Top Cities for Rental Yields in Northern Ireland









Here are 3 top cities with good rental yields in Northern Ireland, UK:

12. Belfast

Belfast, the capital city of Northern Ireland, offers some of the highest rental yields in the region. As of October 2023, the average rental yield for buy-to-let properties in Belfast is 6.1%. The increasing popularity of Belfast for both living and tourism, along with its affordable property prices, helps drive the city’s strong rental demand and yields.

13. Derry

The walled city of Derry (or Londonderry) has a vibrant cultural scene and stunning architecture, attracting many visitors and new residents. In 2023, the average rental yield for buy-to-let properties in Derry reached 4.3%. Areas with a large student population and young professionals, such as Bogside, Brandywell, and Creggan, command the highest returns.

14. Newry

Newry, a historic city in County Down situated near the border of Northern Ireland and the Republic of Ireland, provides rental yields of 2.7% on average. The BT34 and BT35 postcodes cover Newry City Center and Camlough, where yields tend to be higher due to the high demand for city centre living and easy access to amenities.

Frequently Asked Questions

What is a good net yield on rental property UK?

In the UK, a good net yield on a rental property typically falls between 5% and 8%, considering the national average of 5.03%. However, this can vary significantly depending on the location, type of property, and market conditions.

The net rental yield considers all the additional costs associated with owning a rental property, including maintenance, property management fees, insurance, and void periods. It’s a more accurate reflection of the potential return on investment compared to the gross rental yield.

Remember, while yields provide a useful benchmark, they’re just one factor to consider when evaluating a rental property investment. It’s also essential to consider the potential for capital growth, the stability of the rental market in the specific area, and your personal financial situation.

Always make sure to conduct thorough research or consult with a property investment professional before making any investment decisions.

Which city has the highest rental yield in the UK?

Nottingham, Manchester, and Glasgow top the chart for the highest rental yields in the UK, with average yields of over 6%. These cities provide attractive opportunities for property investors due to their robust rental markets.

What is the average rental yield in the UK in 2023?

The average rental yield in the UK as of 2023 is 5.03%.


Overall, the rental market continues to show promising signs for investors seeking good rental yields in the UK. By paying close attention to the latest market trends, researching up-and-coming UK property areas, and crunching the numbers to determine accurate rental yields and cash flow projections, you can make informed investment decisions. Though no investment is without risks, the cities explored in this post indicate the UK rental property market should remain an attractive asset class for buy-to-let investors and those looking to generate passive income through real estate. Contact us today to discuss your property investment plans!

Disclaimer: Any information provided by Baron & Cabot does not constitute financial advice and is for educational purposes only.