South West England’s rental yields are outperforming the rest of the UK in 2025 due to a substantial growth from 7.27% to 8.06% between Q2 2024 and Q2 2025. Plymouth leads with impressive 9.51% yields, while Taunton ranks 14th nationally at 8.36%. You’ll find this region offers a unique balance of affordability and strong returns compared to other southern areas. The combination of economic recovery, population growth, and infrastructure improvements creates an exceptional investment environment.
While most UK regions have experienced modest growth in rental yields, South West England has emerged as the clear frontrunner in 2025. The region’s rental yields have surged from 7.27% in Q2 2024 to 8.06% in Q2 2025, marking an impressive increase of 0.79 percentage points. This growth rate outpaces all other UK regions, including the East Midlands and East Anglia.
South West England leads UK rental yield growth, jumping from 7.27% to 8.06% in 2025, outperforming all other regions.
You’ll find the UK’s average rental yield has increased from 6.70% to 7.11% during this same period. Meanwhile, Scotland was the only region to experience a decline, with yields dropping slightly from 7.56% to 7.48%.
Plymouth stands out as the South West’s star performer, boasting the highest city-level rental yield at 9.51%. Taunton isn’t far behind, ranking 14th nationally with an 8.36% yield. Plymouth‘s PL4 postcode has become particularly active, ranking as the second most dynamic buy-to-let area in the country after Cardiff’s CF24.
The South West’s performance is even more remarkable when compared to other regions. According to data, Wales currently reports the highest yields at 8.59%, outperforming even the flourishing South West market. While northern areas like Yorkshire & Humberside maintain higher overall yields around 8.6%, they show less growth momentum than the South West. Southern regions typically average yields around 6.4%, making the South West’s 8.06% particularly impressive.
Despite registering some of the highest average rental prices across Fleet Mortgages’ lending areas, the South West remains relatively affordable compared to Greater London. This balance of affordability and strong yields has fueled investor interest, with 39% of landlords actively acquiring new properties in Q1 2025.
The region’s success stems from several key factors. Exeter stands out with a 7.4% rental yield, attracting investors with its mix of historic and modern accommodations. You’re seeing the effects of regional economic recovery, population growth, and improvements in local infrastructure. Cities like Plymouth benefit from strong university presence and diverse employment sectors that drive tenant demand.
For buy-to-let investors, the South West offers a compelling combination of strong yield growth, robust rental demand, and relatively attainable purchase prices compared to London and the South East.
Frequently Asked Questions
What Mortgage Rates Are Available for Investors in the Region?
As an investor in South West England, you’ll find buy-to-let mortgage rates currently ranging between 6.5% and 7.5%.
Fixed-rate options are available for 2-5 year terms, with most lenders capping loan-to-value ratios at 75%.
Interest-only mortgages remain popular for cash flow management.
Some lenders offer specialized products for high-yield areas like Plymouth and Taunton.
You’ll need to demonstrate rental income covering 125%-145% of mortgage payments during lender stress tests.
How Do Property Taxes Differ Across South West England?
Property taxes vary greatly across South West England.
You’ll face different SDLT rates based on property value tiers, with Buy-to-Let investments now subject to a 5% starting rate.
Council tax differs by local authority, with Band D properties costing around £1,960 in North Somerset.
Parish precepts add further variation, with some areas like Sedgwick charging between £2,900 and £4,776 depending on the band.
These local tax differences directly impact your potential rental yields.
Are There Specific Licensing Requirements for Landlords in the Area?
You must comply with mandatory HMO licensing for properties with 5+ occupants from 2+ households across South West England.
Many local councils have implemented additional selective licensing schemes that vary by location.
Check your specific council’s website for up-to-date requirements, as these differ considerably.
You’ll need to provide safety certificates, property condition evidence, and proof of deposit protection.
Failure to obtain proper licensing can result in fines up to £30,000 and allow tenants to reclaim up to 12 months’ rent.
Which Property Management Companies Are Most Reliable in South West?
In South West England, you’ll find several reliable property management companies to evaluate.
Hamptons International offers customized services with local market expertise, while Martin & Co is known for its technology integration and competitive fees.
Belvoir! stands out for responsive tenant communication and maintenance.
Local specialists like R&R Property Management (Bristol) and Complete Estate Solutions (Plymouth) provide personalized support.
Companies with ARLA Propertymark membership, transparent fee structures, and robust online platforms typically deliver the most consistent service quality.
How Do Tourist Seasons Affect Rental Yields in Coastal Areas?
Tourist seasons notably impact your coastal property yields.
You’ll see peak occupancy rates during summer months, often 30-50% higher than off-season periods.
Your rental income benefits from premium pricing during high demand, with rates potentially 2-3 times higher than off-season pricing.
While you’ll face increased management costs and turnover logistics during tourist influxes, these expenses are typically offset by the considerably higher rental income you’ll generate during these profitable seasonal windows.
