The annual rental yields across all regions of England and Wales have increase significantly for the third quarter in a row, new data reveals.

The data, from buy-to-let specialist lender, Fleet Mortgages, shows the total yield for both countries increases by 1% to 6.9% on the same quarter in 2022.

This is also up 0.6% on the 6.3% figure in the second quarter in 2023.

Fleet Mortgages said for the second quarter in a row, annual yields had increased across every single region, with a 1%-plus increase in three regions – West Midlands, East Anglia and the South East.

Quarter-on-quarter changes were positive in the North East, Yorkshire & Humberside, West Midlands, South West, East Anglia, South East and Greater London.

The only quarter-on-quarter dips were seen in the North West and Wales.

The North East of England continues to retain its top regional rental yield figure for the thirteenth consecutive quarter, posting a further improved 9.1% yield.

It is East Anglia and the West Midlands however which saw the biggest percentage jump, up 1.3% on the same quarter last year.

The lender said rental yields continued to be driven by the same underlying factors including increased demand from tenants, a shortage of available supply, plus a continued dip in house price levels.

Its latest version of the Rental Barometer, released today (18 Oct), continues to include data covering average rates, loan sizes, landlord portfolio numbers and average monthly rental income by region.

The average monthly rent across the regions where Fleet lends was slightly down from £1,380 per month in Q2 to £1,346 per month in this quarter.

Rental prices ranged from an average of £678 per month in the North East to £2,457 in Greater London.

Regions in the North – North East, North West, and Yorkshire & Humberside – had all seen a slight drop in rental pricing per month, while all other regions showed an increase on the previous quarter.

Fleet Mortgages chief commercial officer Steve Cox, said: “Many of the themes that have been evident in the buy-to-let and private rental sector throughout 2023 continue to strengthen, particularly when it comes to demand for purchase versus remortgage activity, meeting affordability challenges, tenant demand, property supply, and the overall impact on yields and rents.

“Unsurprisingly, when you add of all this together, we find annual rental yields having grown in every single region compared to last year, and this has resulted in a significant 1% increase in yield for England & Wales as a whole.”