Buy-to-let rental yield calculator (UK, 2026)
UK buy-to-let yields typically land 5–7% gross, 3.5–5% net after management, voids, service charge and maintenance. The headline gross is what agents quote — net is what the property actually earns.
Running costs (optional, annual)
Gross yield: 0.00%
Net yield: 0.00%
Yield is one measure of rental return — it ignores capital growth, mortgage interest and tax. Use alongside a proper cash-flow projection.
UK buy-to-let yield benchmarks 2026
| City / property type | Typical gross yield |
|---|---|
| London prime (Zone 1–2) | 3–4% |
| London commuter (Zone 4–6) | 4–5% |
| Bristol / Edinburgh / Brighton | 4.5–5.5% |
| Birmingham / Cardiff | 5.5–6.5% |
| Manchester / Leeds | 6–7% |
| Glasgow / Newcastle | 6.5–7.5% |
| Liverpool | 7–8% |
| HMOs and student lets (any city) | 8–10%+ |
Source: published 2026 BTL benchmarks aggregated from major UK letting agents, HM Land Registry sales data and Registers of Scotland.
The geographic spread is wide. A £200,000 flat in Liverpool yielding 7.5% gross produces the same annual rent (£15,000) as a £400,000 London flat yielding 3.75% — but the cash flow comparison ignores capital growth, which has historically favoured the South.
Why net yield matters more than gross
Gross yield is what every agent quotes and what every back-of-envelope BTL calculation uses. Net yield is what the property actually earns.
For a typical UK BTL — £220,000 price, £1,100 monthly rent, 10% management, leasehold with £1,500 service charge:
| Item | Annual cost |
|---|---|
| Annual rent (£1,100 × 12) | £13,200 |
| Management (10%) | (£1,320) |
| Maintenance (1% of value) | (£2,200) |
| Insurance | (£350) |
| Service charge (typical leasehold) | (£1,500) |
| Voids (2 weeks/year) | (£508) |
| Net income | £7,322 |
Gross yield: 6.0%. Net yield: 3.3%. The 2.7-percentage-point gap is typical — service charge plus management plus voids are the biggest deductions, in roughly that order.
How leverage changes the picture
Yield numbers above are pre-finance. Once you factor a 75% LTV mortgage at 4.5% interest, the picture changes:
- Property: £220,000
- Mortgage: £165,000 (75% LTV) at 4.5%, interest-only
- Deposit: £55,000
- Annual mortgage interest: £7,425
- Net rental income (from above): £7,322
- After-finance net cash flow: −£103/year
A leveraged BTL at 6% gross, 3.3% net and 4.5% interest produces approximately zero cash flow. Capital growth has to do all the work. This is why so many UK BTL investors have either de-levered (lower LTV, more cash deposit) or moved to higher-yielding stock (HMOs, Northern markets, student lets) since interest rates rose in 2022–2023.
Hidden cost categories that catch landlords out
- Section 24 tax — limits mortgage interest tax relief to 20% for personal landlords, materially reducing after-tax income for higher-rate taxpayers
- EPC C compliance (England, expected by 2030 for new tenancies) — older properties may need £5,000+ of insulation, glazing or boiler upgrades
- Selective licensing — £400–£900 per property for 5 years, increasingly common in Northern English cities
- HMO licensing — typically £600–£1,200/year, plus higher fire-safety capex
- Tenant Fees Act compliance — most agency fees moved to landlord, increasing management cost
Build £200–£500/year into "other" costs in the calculator above to account for these.
Worked examples — comparing UK markets
Example 1 — Liverpool L7 4-bed HMO. Price £180,000, total rent £1,800/month. Gross 12%. After full HMO running costs and licensing: net ~£11,200 → 6.2% net.
Example 2 — Manchester M3 city-centre flat. Price £225,000, rent £1,250/month. Gross 6.7%. After full leasehold costs: net ~£6,200 → 2.8% net (high service charge).
Example 3 — Bristol BS5 4-bed semi-HMO. Price £350,000, rent £2,400/month. Gross 8.2%. After full HMO costs: net ~£14,600 → 4.2% net.
Example 4 — London Zone 4 1-bed flat. Price £375,000, rent £1,750/month. Gross 5.6%. After full London leasehold costs: net ~£10,200 → 2.7% net.
The pattern: gross yield mostly tracks geographic price differences, but net yield narrows the gap once costs are normalised. Total return = net yield + capital growth, and growth differs materially by market.
Where Offrly fits
Buy-to-let returns are unusually sensitive to overpaying — every £10,000 of price padding costs you the cash plus £500 of stamp-duty surcharge plus 0.4–0.5 percentage points of gross yield permanently. Offrly's AI reads each comparable's photos (garden, condition, layout, finish) and hyperlocal pricing resolves prices and rents to the street rather than the postcode — in about 30 seconds. Free. No email. The sale-side estimate sanity-checks the asking; the rental estimate sanity-checks the agent's rent forecast.
Run a free Offrly valuation → · Run a free Offrly rental valuation →
Other rental yield calculators: Manchester · Birmingham · Leeds · Liverpool · Glasgow · Bristol · Gross vs net · Head calculator
Disclaimer: Yield is one measure of rental return — it ignores capital growth, mortgage interest and tax. Use alongside a proper cash-flow projection. Section 24 and BTL taxation are technical — consult an independent tax adviser before structuring acquisitions.
FAQ: Buy-to-let rental yield calculator (UK, 2026)
What's a good rental yield for a UK buy-to-let in 2026?
Typical UK BTL gross yields range 4–8% depending on city and property type. London 3–4%; Bristol/Edinburgh 4.5–5.5%; Birmingham/Manchester/Leeds 5.5–7%; Liverpool/Glasgow/Newcastle 6.5–8%; HMOs and student lets sometimes above 9% gross. Net yield matters more — anything above 4% net for a leveraged BTL is respectable. Source: UK BTL benchmarks aggregated from major letting agents and HM Land Registry / Registers of Scotland sales data, 2026.
How is buy-to-let yield calculated in the UK?
Gross yield = annual rent ÷ purchase price (or current value), as a percentage. Net yield = (annual rent − annual running costs) ÷ price. UK convention is to use purchase price including all-in transaction costs (stamp duty, conveyancing, survey) for the most honest figure — but many agents quote gross against just the asking price.
What running costs should a UK BTL include?
At minimum: management fees (10–12% if fully managed, or your time), maintenance (1% of value/year rule of thumb), landlord insurance (£250–£500/year), service charge and ground rent (leasehold flats only), voids (2–4 weeks per year typical), selective licensing or HMO licensing where applicable. Optional but recommended: contingency fund for white goods, boiler replacement, redecoration.
Should I include mortgage interest in the yield calculation?
No — net yield is pre-finance, pre-tax. The output measure that includes mortgage interest is cash-on-cash return: subtract annual mortgage interest from net rental income, divide by your deposit. A 4% net yield on a 75% LTV mortgage at 4.5% interest can produce a cash-on-cash return of 6–9% depending on price growth — but that math gets complex quickly and depends on tax position.
How does Section 24 affect buy-to-let yields?
Section 24 (UK mortgage interest restriction) doesn't affect rental yield directly — it affects after-tax income for personal landlords by capping mortgage interest tax relief at the basic rate (20%) regardless of the landlord's marginal rate. Higher-rate landlords now pay tax on rental income before mortgage interest is fully deducted. Many landlords have moved to limited-company ownership for new acquisitions, where Section 24 doesn't apply and full mortgage interest is deductible.