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Average rental yields increase

Average rental yields increase

Category: Buy To Let

Updated: 22/05/2017
First Published: 10/08/2012

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Property investors are benefitting from the high demand for rental accommodation, as rental yields grow.

Rental yield, also known as return, is the total investment income received from renting out a particular property. Higher demand for rental property has seen rents increase and in turn has also seen yields grow.

Figures from BM Solutions have revealed that the average gross rental yield has grown over the past year from 6.00% to 6.2%, mainly due to a 5.3% increase in average rental income.

The biggest increase in rental growth was in London, with average monthly rents rising by 10.5% over the past year. Despite experiencing the biggest growth, investors in the capital saw the lowest rental return.

Phil Rickards, spokesperson at BM Solutions, said: Whilst rental yields have remained steady over the past year, it should be noted that these figures do not take into account the time when properties are vacant - which can impact the average yields.

"Despite the encouraging figures, it's still really important for any potential investors in the market to do their homework and seek expert advice first."

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