Strong yields, rising rents and continued activity among portfolio landlords suggest enduring confidence in the UK’s buy-to-let market, according to Fleet Mortgages’ latest Rental Barometer for Q2 2025.
Average rents across England and Wales rose by 2.9% in the second quarter, with standout growth in the North East (+21.8%), Wales (+7.8%) and Greater London (+6.5%).
London continues to command the highest average monthly rent at £2,328, followed by East Anglia (£1,640) and the South East (£1,520).
At the other end of the scale, Yorkshire & Humberside (£861), the North East (£900) and Wales (£1,061) remain the most affordable regions, offering attractive returns for investors.
NORMALISING DECLINES
Rental yields averaged 7.5% nationally, up from 7.4% in Q1. Wales led the pack with yields of 9%, followed by the North West (8.8%) and the North East (8.7%).
While modest year-on-year yield declines were recorded in some areas – including the North East (-1.4%) and West Midlands (-0.8%) – Fleet says these are likely normalising after strong growth in previous quarters.
STRONG ENGAGEMENT
Over half (54%) of Fleet’s Q2 applications came from landlords with four or more properties, with the average portfolio now standing at 10. First-time landlords accounted for 14% of applications, maintaining the level seen in Q1.
Corporate borrowing continues to dominate, with 81% of mortgage applications made via limited companies.
COMPELLING MIX
Steve Cox, Chief Commercial Officer at Fleet Mortgages, says: “There’s no question that certain regions – particularly Wales and the North East – are offering a compelling mix of affordability and rental return, while the South continues to deliver strong capital value and long-term resilience.
“What’s also clear is the so-called landlord exodus hasn’t materialised. This is a sign of landlords actively reshaping and expanding their portfolios in line with evolving tenant demand.”
