15 UK Postcodes With the Highest Rental Yields (2026)
Gross rental yield is calculated as:
(Annual rent ÷ purchase price) × 100 — a key metric used by investors to estimate income return before expenses. (RentalYield.uk)
| Rank | Postcode District | Area / Town | Typical Gross Yield | Why It’s High |
|---|---|---|---|---|
| 1 | SR1 | Sunderland (central) | ~11.8% | Very low prices, solid rental demand. (RentalYield.uk) |
| 2 | DL4 | Shildon (County Durham) | ~10.0% | Extremely affordable stock vs stable rents. (RentalYield.uk) |
| 3 | TS2 | Middlesbrough | ~9.3% | Strong local rental demand with low entry price. (RentalYield.uk) |
| 4 | TS1 | Middlesbrough | ~9.0% | Similar drivers as TS2: low prices, decent rents. (RentalYield.uk) |
| 5 | DL17 | Ferryhill (County Durham) | ~8.5% | Small market but high yield due to pricing. (RentalYield.uk) |
| 6 | SR8 | Peterlee (County Durham) | ~8.5% | Affordable buy‑in + steady demand. (RentalYield.uk) |
| 7 | DN31 | Grimsby | ~8.5% | Lower prices with modest rent levels. (RentalYield.uk) |
| 8 | BD1 | Bradford | ~8.4% | Strong affordability + multiple tenant types. (RentalYield.uk) |
| 9 | L4 | Liverpool | ~8.1% | Youth/student demand and low prices. (RentalYield.uk) |
| 10 | L6 | Liverpool | ~8.1% | Similar to L4 with good cash flow. (RentalYield.uk) |
| 11 | BB11 | Burnley | ~8.5%+ | Very affordable housing with steady rents. (RentalYield.uk) |
| 12 | TS24 | Hartlepool | ~8.3% | North East city with high rental returns. (RentalYield.uk) |
| 13 | BB12 | Burnley Wood | ~8.2% | Another Burnley postcode with strong yields. (RentalYield.uk) |
| 14 | NG7 | Nottingham | ~7–8%* | University town support boosts rents. (UK Post Code) |
| 15 | G11 / G32 | Glasgow areas | ~7–8%* | Large student population + solid demand. (UK Post Code) |
* Postcodes like NG7 and some Glasgow districts are not always in the top 10 by nationwide gross yield based on strict government data, but multiple market sources cite them among strong yield hotspots worth watching. (UK Post Code)
What Makes These Postcodes High Yield
1. Lower Purchase Prices
Many of the top‑yielding postcode districts — e.g. SR1 (Sunderland) or DL4 (Shildon) — have median house prices often below £70,000–£100,000, meaning rents make up a higher proportion of capital cost. (RentalYield.uk)
2. Strong Local Rental Demand
Areas with universities (e.g., NG7 Nottingham), hospitals, public sector employment or young professional populations tend to keep occupancy high and rents stable relative to price. (UK Post Code)
3. Regional Geography
Northern England and North East postcode districts systematically show higher average yields than London or Southern postcodes, where high prices squeeze the rent‑to‑value ratio. (RentalYield.uk)
4. HMO & Multiple Tenant Potential
Many of these districts are suitable for houses in multiple occupation (HMOs), which can push gross yields even higher when multiple rooms are rented separately. (UK Post Code)
Regional Yield Patterns (2026)
According to recent data:
- North East England has the highest average yields (~4.63%). (RentalYield.uk)
- North West and Yorkshire & The Humber follow with consistently strong returns. (RentalYield.uk)
- London and the South East generally lag due to high property prices relative to rents. (RentalYield.uk)
Important Notes for Investors
- Gross yield ≠ net yield: Management fees, insurance, tax, void periods, and maintenance will reduce net returns — sometimes significantly. Always model net yield for your strategy. (UK Post Code)
- Market type matters: High yields often come with slower capital growth. Some investors prefer balancing yield with long‑term price uplift. (RentalYield.uk)
- Check licensing: Some areas require landlord licensing or HMO permits, which affect costs and compliance. (UK Post Code)
Quick Tips Before Investing
Check recent rent prices with local agents
Compare median house price vs rent to calculate realistic yields
Factor in void periods and maintenance costs
Analyze capital growth prospects alongside yield for total returns
Here’s a detailed, case‑study style breakdown of 15 UK postcode districts with the highest rental yields — including what specific postcodes deliver, why they get high yields, sample examples, and investor comments/considerations. Most of the data here is drawn from recent UK rental yield reports compiled from official HM Land Registry + Valuation Office Agency figures and market analyses. (RentalYield.uk)
Top 15 UK Postcodes With Highest Rental Yields (2026)
Gross rental yield = (Annual rent ÷ Median purchase price) × 100. These figures focus on income returns relative to price, not net profit after expenses or capital growth (which may differ). (RentalYield.uk)
1) SR1 – Sunderland Central (North East England)
Yield (approx): ~11.8% — highest in England based on government rental data. (RentalYield.uk)
Case study: Small flats or terraced houses often sell below ~£60k–£70k but can let for strong rents relative to price. Investors and local agents report that even 1–2‑bed properties can yield around 8–10%+ gross in some streets. (RentalYield.uk)
Comment: Sunderland benefits from very low entry prices and steady working‑tenant demand (healthcare, public sector, education), making it a classic yield‑first location. (UK Post Code)
2) DL4 – Shildon (County Durham)
Yield: ~9.9% — Ranked second by RentalYield.uk. (RentalYield.uk)
Case study: Properties in this postcode typically have very low sale prices (~£60k) and local rental demand from commuters and local workers. (RentalYield.uk)
Comment: Small‑town demand combined with low capital cost drives high headline yield — but investors should check stock quality and licensing requirements. (UK Post Code)
3) TS2 – Middlesbrough Central
Yield: ~9.3% — Third highest by official data. (RentalYield.uk)
Case study: TS2 properties are usually terraced houses or flats around Middlesbrough centre with strong rental pool from students, NHS workers and entry‑level professionals. (RentalYield.uk)
Comment: Capital values are low versus achievable rents, which lifts gross yields — but tenants often expect modern appliances and good maintenance. (UK Post Code)
4) TS1 – Middlesbrough
Yield: ~9.0% — Also near the highest yields overall. (RentalYield.uk)
Case study: Similar to TS2, the TS1 postcode presents high yield because of low market values relative to modest but stable rents. (RentalYield.uk)
Comment: Good choice for investors prioritising cashflow — though capital growth prospects may lag larger cities. (UK Post Code)
5) DL17 – Ferryhill (County Durham)
Yield: ~8.54% — Among the top high‑yield UK postcodes. (RentalYield.uk)
Case study: Smaller town with lower property prices and solid local rental demand makes this postcode attractive for steady income. (RentalYield.uk)
Comment: Not a “headline prestige” location, but strong numbers for yield‑focused portfolios. (UK Post Code)
6) SR8 – Peterlee (County Durham)
Yield: ~8.54% — Tied with Ferryhill. (RentalYield.uk)
Case study: This postcode has steady demand from tradespeople, local government employees and NHS staff. (RentalYield.uk)
Comment: High headline yields often require careful due diligence on stock quality and tenant demand. (UK Post Code)
7) DN31 – Grimsby (North East Lincolnshire)
Yield: ~8.47% — Strong rental returns near industrial and port employment hubs. (RentalYield.uk)
Case study: Tenanted by working families and single professionals — reliable rental pool keeps occupancy stable. (RentalYield.uk)
Comment: Stocks are affordable and often suitable for 2‑bed or 3‑bed family lets. (UK Post Code)
8) BD1 – Bradford City Centre
Yield: ~8.4% — Ranked top in Yorkshire and among the UK’s best for yield. (RentalYield.uk)
Case study: Older terraced houses and small flats let to a mix of students, NHS workers, and professionals — strong rent per pound cost. (UK Post Code)
Comment: Some micro‑areas show double‑digit gross yields when rented as HMOs, though condition and management costs can be higher. (UK Post Code)
9) L4 – Liverpool West Derby
Yield: ~8.1% — One of Liverpool’s strongest yield postcodes. (RentalYield.uk)
Case study: Flats often buy for £100k or less and command rents supported by students, young professionals, and new graduates. (UK Post Code)
Comment: Regeneration and employment growth in Liverpool help sustain demand even as capital values rise. (UK Post Code)
10) L6 – Liverpool (County area)
Yield: ~8.1% — Similar performance to L4. (RentalYield.uk)
Case study: Investors often convert older stock to HMOs to maximize income — though licensing requirements in some areas must be checked. (UK Post Code)
Comment: Liverpool’s youthful rental market supports yields that outperform many southern areas. (UK Post Code)
11) BB11 – Burnley (Lancashire)
Yield: ~8.5%–8.8% — According to broader rental reports. (RentalYield.uk)
Case study: Smaller entry prices (often under £100k) and mid‑range rents help deliver high gross yields. (RentalYield.uk)
Comment: Burnley often appears on high‑yield lists because of its affordable price base. (RentalYield.uk)
12) TS24 – Hartlepool
Yield: ~8.3% — Another top district in 2026 yield rankings. (RentalYield.uk)
Case study: Terraced houses and small flats let to local workers and commuters — good occupancy and yield. (RentalYield.uk)
Comment: Often paired with other Northeast markets for portfolio diversification. (RentalYield.uk)
13) BB12 – Burnley Wood
Yield: ~8.2% — Close neighbour to BB11 with similarly high yields. (RentalYield.uk)
Case study: Investors often target this postcode for entry‑level terraced houses offering steady rents relative to price. (RentalYield.uk)
Comment: Suitable for portfolios where cashflow priority beats capital growth. (RentalYield.uk)
14) PL4 – Plymouth East (South West England) (not in official Top 10 but cited by some market guides)
Yield band often quoted: ~8%–10%+ in specific areas. (UK Post Code)
Case study: Some investor reports show double‑digit gross yields in PL4 when properties are well‑priced and let to stable tenants. (UK Post Code)
Comment: Benefits from student and NHS/public sector demand, but local authority licensing and compliance can affect net returns. (UK Post Code)
15) CF24 – Cardiff Central (again cited in independent yield lists)
Yield band: ~7%–9% in certain streets according to market summaries. (UK Post Code)
Case study: Mixed rental demand from students, professionals and public sector workers supports consistent occupancy. (UK Post Code)
Comment: Wales often ranks high regionally for yields, partly because prices lag rents relative to Southern England. (UK Post Code)
Key Insights & Commentary
North‑South Yield Divide
Data shows highest yields are concentrated outside London and the South East, especially in the North East, North West, and Yorkshire & Humber, where lower house prices relative to rental rates elevate gross yields. (RentalYield.uk)
Yield vs. Capital Growth
High gross yield doesn’t always mean high capital growth. Many of the top postcodes excel at cashflow, but long‑term equity gains can be stronger in more expensive areas (e.g., commuter belts, Southern cities). (RentalYield.uk)
Investment Strategy
- Cashflow focus: Northern postcodes like SR1, DL4, TS2 often lead due to low prices and decent rents. (RentalYield.uk)
- Balanced growth + yield: Some Liverpool and Cardiff postcodes offer good yields with emerging regeneration potential. (UK Post Code)
- Licensing considerations: HMO licensing in some high‑yield areas can reduce net yield if not planned for. (UK Post Code)
Practical Investor Tips
- Always verify rents locally with agents — advertised yields can be overstated if rents haven’t kept pace with market. (UK Post Code)
- Check local licensing and compliance costs, especially in high‑yield towns where councils often require selective landlord/HMO licences. (UK Post Code)
- Model net yield after expenses (voids, repairs, insurance, management fees, mortgage costs) — gross yield is a starting point. (RentalYield.uk)