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Which type of property offers the best yield – and where?

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A three-bedroom house or a one-bed flat - where can landlords achieve the best return?
Which type of property offers the best yield – and where?

One-bedroom properties prove the best financial investment for landlords, according to Howsy.

The lettings management platform said that when it comes to buy-to-let rental yields across the UK’s major cities, one-beds offer the highest average return, at 6.2%.

This is followed by two-bed properties, which yield 5.6% on average, while three-beds achieve 5%.

Best place to buy

When it comes to investing in a one-bed buy-to-let, Newcastle offers the highest average yield, at 7.9%, closely followed by Glasgow (7.7%), Liverpool (7.1%) and Plymouth (7%).

Newcastle and Glasgow also rank along with Belfast (6.9%) as the best spots for a two-bed buy-to-let investment, with Sheffield (6.7%) and Leeds (6.4%) close behind.

For three-bed properties, Glasgow tops the table, yielding 6.9%.

Founder and CEO of Howsy, Calum Brannan, said: “We’re seeing a lot of changes to traditional property trends across the sector and the latest seems to be the profitability of the three-bed buy-to-let. While still a good investment, on the whole, tenants demand is growing for one and two-bed homes that provide them with a space of their own.

“This growing demand is leading to one and two-bed properties climbing the ranks of profitability due to their lower investment price point and higher demand pushing up rental prices.”

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