Rental yields fall, but heh!

Rental yields are falling according to a report from BTL lender BM solutions.

The fall in yields are as a result of rent inflation not keeping pace with a buoyant housing market. In the second half of last year the average rental yield dropped from 5.6% to 5.5%.

However, its all swings and roundabouts, and most landlords are finding that any fall in rental yield is happily compensated by the increase in the property value.

Phil Rickards, head of BM Solutions, said: ‘Demand for rental accommodation remains strong, and in many regions this is outstripping supply which can lead to an upward pressure on rent prices. However, our figures show that even with increasing rents, the average yield that investors are getting has remained static, which will be driven by the fact that the average price of a typical buy to let property has grown marginally faster that average rents.’