The Areas of London With the Highest Rental Yields and Rents
London's property market continues to be a compelling option for buy-to-let investors, offering a unique blend of stability and potential for high returns. The city's vast and diverse property landscape presents many opportunities, with rental yields and weekly rents varying significantly across different regions.
Our analysis of postcodes across Greater London reveals interesting patterns:
- East London boasts some of the highest yields, with areas like Purfleet (RM19) offering up to 7.3% yield.
- West London while generally offering lower yields, commands some of the highest weekly rents, with areas like Mayfair (W1) averaging £1,038 per week.
- South London presents a mix of high-yield areas like Greenhithe (DA9) at 6.3% and areas with strong weekly rents like Battersea (SW11) at £824 per week.
- North London shows a balance between yield and rent, with areas like Enfield (EN3) offering 5.8% yield and St John's Wood (NW8) commanding £1,216 weekly rent.
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by Robert Jones, Founder of Property Investments UK
With nearly two decades in UK property, Rob has been investing in buy-to-let since 2005, and uses property data to develop tools for property market analysis.
Best Rental Yields Across Greater London by Region
Below we look at the 4 main regions across the Capital, so whether you are prioritising high yields or the best £ rental income per week, below is the latest London property data showing the highest results in each region next to the average house prices so you can focus on regions and postcode districts within your budgets.
Property Data Sources
Our location guide relies on diverse, authoritative datasets including:
- HM Land Registry UK House Price Index
- Ministry of Housing, Communities and Local Government
- Ordnance Survey Data Hub
- London Rental Map
- Propertydata.co.uk
We update our property data quarterly to ensure accuracy. Last update: September 2024. Next update: December 2024. All data is presented as provided by our sources without adjustments or amendments.
North London Highest Rental Yields (%)
| Area | Yield % | Avg. Price £ | Avg. Weekly Rent £ |
|---|---|---|---|
| EN3 (Enfield) | 5.8% | £382,827 | £426 |
| N17 (Tottenham) | 5.6% | £461,603 | £495 |
| N18 (Edmonton) | 5.6% | £398,891 | £431 |
| N7 (Holloway) | 5.2% | £579,418 | £581 |
| NW9 (Kingsbury) | 5.2% | £468,241 | £466 |
| N9 (Edmonton) | 5.0% | £384,739 | £373 |
| EN8 (Cheshunt) | 4.9% | £405,426 | £382 |
| N19 (Archway) | 4.9% | £585,197 | £555 |
| N15 (Seven Sisters) | 4.4% | £511,689 | £436 |
| N4 (Finsbury Park) | 4.3% | £641,153 | £533 |
East London Highest Rental Yields (%)
| Area | Yield % | Avg. Price £ | Avg. Weekly Rent £ |
|---|---|---|---|
| RM19 (Purfleet) | 7.3% | £233,549 | £329 |
| IG11 (Barking) | 6.8% | £324,616 | £422 |
| RM10 (Dagenham) | 6.7% | £364,244 | £466 |
| E3 (Bow) | 6.3% | £441,858 | £537 |
| RM8 (Dagenham) | 6.2% | £382,815 | £454 |
| E16 (Canning Town) | 6.1% | £442,434 | £516 |
| RM20 (Grays) | 6.1% | £302,741 | £355 |
| E6 (East Ham) | 6.0% | £416,973 | £483 |
| RM9 (Dagenham) | 5.9% | £379,826 | £432 |
| E13 (Plaistow) | 5.8% | £416,884 | £468 |
South London Highest Rental Yields (%)
| Area | Yield % | Avg. Price £ | Avg. Weekly Rent £ |
|---|---|---|---|
| DA9 (Greenhithe) | 6.3% | £299,690 | £363 |
| SE28 (Thamesmead) | 6.1% | £347,148 | £404 |
| SE17 (Walworth) | 5.9% | £551,711 | £622 |
| DA8 (Erith) | 5.7% | £368,656 | £407 |
| RM17 (Grays) | 5.7% | £320,017 | £352 |
| SE18 (Woolwich) | 5.6% | £436,929 | £468 |
| DA17 (Belvedere) | 5.5% | £354,984 | £376 |
| SE8 (Deptford) | 5.5% | £446,555 | £472 |
| DA1 (Dartford) | 5.4% | £364,610 | £378 |
| DA10 (Swanscombe) | 5.4% | £381,360 | £394 |
West London Highest Rental Yields (%)
| Area | Yield % | Avg. Price £ | Avg. Weekly Rent £ |
|---|---|---|---|
| UB3 (Hayes) | 5.1% | £413,236 | £409 |
| UB5 (Northolt) | 5.1% | £384,905 | £381 |
| UB7 (West Drayton) | 5.1% | £392,555 | £382 |
| UB2 (Southall) | 4.8% | £458,028 | £419 |
| HA0 (Wembley) | 4.8% | £502,686 | £468 |
| TW3 (Hounslow) | 4.8% | £422,819 | £387 |
| W2 (Paddington) | 4.7% | £1,079,833 | £981 |
| UB1 (Southall) | 4.6% | £478,474 | £422 |
| W3 (Acton) | 4.6% | £587,439 | £524 |
| W6 (Hammersmith) | 4.5% | £849,904 | £727 |
Highest Weekly Rents (£) Across Greater London by Region
This is distinctively different to yield. Below we look at simply the highest average rent price, by £ per week, on average in each postcode district.
Property Data Sources
Our location guide relies on diverse, authoritative datasets including:
- HM Land Registry UK House Price Index
- Ministry of Housing, Communities and Local Government
- Ordnance Survey Data Hub
- London Rental Map
- Propertydata.co.uk
We update our property data quarterly to ensure accuracy. Last update: September 2024. Next update: December 2024. All data is presented as provided by our sources without adjustments or amendments.
North London Best Rent Per Week (£)
| Area | Rent Per Week (£) |
|---|---|
| NW8 (St John's Wood) | £1,216 |
| NW3 (Hampstead) | £955 |
| NW1 (Camden Town) | £754 |
| NW5 (Kentish Town) | £699 |
| N1 (Islington, Canonbury) | £667 |
| N5 (Highbury) | £578 |
| NW11 (Golders Green) | £570 |
| N2 (East Finchley) | £568 |
| N6 (Highgate) | £546 |
| N4 (Finsbury Park) | £533 |
East London Best Rent Per Week (£)
| Area | Rent Per Week (£) |
|---|---|
| E1 (Whitechapel) | £622 |
| E2 (Bethnal Green) | £568 |
| E9 (Hackney) | £558 |
| E14 (Poplar) | £554 |
| E8 (Hackney Central) | £538 |
| E3 (Bow) | £537 |
| E16 (Canning Town) | £516 |
| E15 (Stratford) | £514 |
| E5 (Clapton) | £500 |
| E11 (Leytonstone) | £422 |
South London Best Rent Per Week (£)
| Area | Rent Per Week (£) |
|---|---|
| SW11 (Battersea) | £824 |
| SE1 (Southwark) | £656 |
| SE17 (Walworth) | £622 |
| SW18 (Wandsworth) | £617 |
| SW4 (Clapham) | £597 |
| SW12 (Balham) | £582 |
| SE16 (Rotherhithe) | £551 |
| SW19 (Wimbledon) | £549 |
| SE15 (Peckham) | £533 |
| SE10 (Greenwich) | £510 |
West London Best Rent Per Week (£)
| Area | Rent Per Week (£) |
|---|---|
| SW7 (South Kensington) | £1,237 |
| W1 (Mayfair) | £1,038 |
| W8 (Kensington) | £1,036 |
| SW1 (Belgravia) | £1,032 |
| SW3 (Chelsea) | £987 |
| W2 (Paddington) | £981 |
| W11 (Notting Hill) | £878 |
| SW10 (West Brompton) | £844 |
| W6 (Hammersmith) | £727 |
| SW6 (Fulham) | £719 |
Factors Contributing to High Rental Yields
This regional breakdown of both rental yields and weekly rents provides a comprehensive view of the London buy-to-let market, allowing investors to compare opportunities across different areas of the city. But what are the contributing factors behind this property data?
Areas with lower property prices but steady rental demand often produce higher yields. This is because the yield is a simple calculation of the property price and the rental income. This explains why outer London boroughs feature prominently in the high-yield list as the asset costs in those locations are much lower than elsewhere in Greater London.
Good transport connections can significantly boost an area's appeal to renters. For example, the Elizabeth Line has enhanced connectivity in areas like Abbey Wood (SE2) and Woolwich (SE18), potentially contributing to their attractive yields.
Areas undergoing regeneration often see improved yields as the area becomes more desirable, but property prices haven't yet caught up. The ongoing regeneration in areas like Barking (IG11) may be a factor in its high 6.8% yield.
Why Data Can Fluctuate
It's important to note that rental yield data can fluctuate throughout the year due to various factors:
- Seasonal variations in the rental market.
- Local market conditions. If there are very few properties on the market to rent, there will be less comparable data points and this can skew the data.
- A newly updated property sales report from HM Land Registry with increased or reduced house prices.
- Significant changes in local amenities or transport links creating a boost in tenant demand and increase in rents.
Investors should always conduct thorough research and consider long-term trends rather than relying solely on current yield data.
Frequently Asked Questions
Q: What is a good rental yield in Greater London?
A: While this can vary, generally a yield over 5% is considered good for London. However, the average yield across Greater London is 4.19%, so anything above this could be seen as above average.
Q: Are higher yields always better areas and properties for buy-to-let investors?
A: Not necessarily. While high yields are attractive, they can sometimes indicate higher risk or areas with less potential for capital growth. They are often found in the cheapest house price regions of the Capital. It's important to balance yield with other factors like location quality, tenant demand and potential for appreciation. Focusing on the financials of the property include all these elements and monthly cashflow. Make sure you have an investment property checklist when you are assessing any potential opportunities.
Q: How do I calculate rental yield?
A: Gross rental yield is calculated by dividing the annual rental income by the property purchase price, then multiplying by 100. For example, if a property costs £300,000 and rents for £1,500 per month:
(£1,500 * 12) / £300,000 * 100 = 6% yield
We have an article with a rental yield calculator here.
Q: Why are yields in central London often lower?
A: Central London areas often have very high property prices, which can result in lower percentage yields even though the actual rental income is high and the rental demand is strong. These areas often attract investors more interested in capital appreciation than rental income and who are looking for the areas with the highest house price growth across London.