Buy-to-let properties are generating the highest average rental yields since February 2011, new Paragon Bank figures have revealed.
Analysis of Paragon Bank lending data has revealed that average rental yields of 7.11% were achieved by landlords in April 2025. This is the highest level since February 2011, when the figure was just one basis point higher at 7.12%.
Following consecutive monthly increases during the first quarter of this year, the latest figure surpasses the 6.94% recorded at the end of Q4 2024, which was then a 13-year high.
Paragon Bank’s mortgage offer data for buy-to-let purchase and remortgage show that the latest rental income to property value ratio represents year-on-year growth of 40 basis points. This reflects moderation of house price inflation alongside rent increases, driven by continued high levels of tenant demand and undersupply of privately rented homes.
Over a longer term, an overall upward trend in average yields has been evident since the low of 4.91% of May 2017.
Russell Anderson, Paragon Bank Commercial Director of Mortgages, says: “Our latest lending data highlights how average rental yields have continued to increase from the 13-year high we revealed at the end of last year. While the most recent economic instability caused by the threat of Trump’s tariffs is understandably impacting business confidence across many sectors, these figures offer tangible evidence that buy-to-let continues to offer strong returns for investors.
“This is particularly true where landlords employ a strategy of targeting properties that offer higher returns, HMOs being the most obvious example, or investing in areas where property is relatively more affordable but benefits from the strong tenant demand we see all over the UK.”
With average yields of 8.43% in April 2025, up from 8.09% since December 2024, Wales continues to be the region offering the strongest returns on buy-to-let investments. Likewise, Greater London remains the region where landlords achieve the lowest rental yields of 5.78%, despite an increase of 30 basis points since Q4 2024.
| Region | Yield |
| Wales | 8.43% |
| Yorkshire & Humberside | 7.97% |
| North | 7.94% |
| South West | 7.93% |
| North West | 7.85% |
| East Anglia | 7.60% |
| West Midlands | 7.52% |
| East Midlands | 7.49% |
| Scotland | 7.46% |
| South East | 6.57% |
| Greater London | 5.78% |
Analysing the data by property type highlights how more complex propositions continue to typically deliver the highest yields, particularly Houses in Multiple Occupation (HMO) with yields of 8.50%, up from 8.41 in December last year.
