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14/7/25 8:13 pm
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Rental yields across England and Wales edged up for the second quarter in a row, driven by sustained tenant demand, according to specialist lender Fleet Mortgages.
It reports that most regions posted annual increases in Q3; the North East remained the top-yielding region at 9%, followed closely by the North West at 8.5%. Yorkshire & Humberside and Wales both delivered a strong performance with yields climbing to 8.2%, while the South West (7%) and East Anglia (6.6%) posted some of the largest annual improvements.
Fleet says these regions continue to hold an attraction for landlords due to the combination of yield strength, comparatively lower property prices, and strong levels of tenant demand, particularly when supply remains constrained.
At the national level, average yields across England and Wales rose by 0.3% year-on-year to reach 7.5%. The biggest yearly gain came from Wales, which saw yields rise by a full percentage point.
Fleet’s research reveals that limited company borrowing accounted for 81% of Fleet’s Q3 applications, while portfolio landlords continue to be increasingly prominent, with 61% of applications coming from those holding four or more properties and nearly a quarter (23%) from landlords with 15 or more – up sharply from 16% in Q2. First-time landlord activity held at 12%, suggesting new entrants are still being drawn to the sector.
Steve Cox, chief commercial officer (pictured), says there’s a marked shift towards professionalism. “Rather than exiting the sector, many landlords are scaling up, refinancing portfolios, and structuring their businesses in ways that help them absorb regulatory and cost pressures more effectively, while still pursuing property purchases,” he adds.
“Affordability remains a hurdle, especially for those entering the market for the first time, but with tenant demand consistently outstripping supply, rental growth continues to be a strong driver of yields.”
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