Buy-to-let (BTL) properties are generating the highest average yields since February 2011, research by Paragon Bank has revealed.

The bank’s latest lending data analysis showed that that the average rental yield achieved by landlords reached 7.11% in April 2025.

This is highest level since February 2011, when the figure was one base point higher at 7.12%.

Paragon said the latest results follow consecutive monthly increases during the first quarter of the year, with the latest figure surpassing 6.94% recorded at the end of 2024, which was a 13-year high at the time.

Wales continued to be the region offering the strongest returns on BTL investments, recording a yield of 8.43% in Q1 2025. This was an increase on 8.09% in Q4 2024.

Greater London remained the region where landlords achieved the lowest rental yields, at 5.78%, despite an increase of 30 basis points since Q4 2024.

Commercial director of mortgages at Paragon Bank, Russell Anderson, said: "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."

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