In addition to this, major lenders have continued to cut rates and raise their lending ceilings, and investors and landlords can now once again look to improve profitability and expand their portfolios.
What areas in the capital might be the best places to do that?
According to the latest data and market analysis from Portico, East London continues to offer the best rental yields in the capital.
Within east London, the area of Abbey Wood has experienced an influx of savvy investors buying up affordable properties to let near the train station, thanks to the imminent arrival of the Crossrail. With 12 fast central London trains every hour, the promise of this service has significantly bolstered this area’s growth, taking top spot for the best rental yields throughout London for the quarter, at an impressive 6.7%. The highest yield in the area can be found along Yarnton Way to the east.
And it’s merely a hop, skip and a jump to the next best rental yield areas according to Portico. Across the Beam River, properties in the area of Dagenham Road are also benefiting from a proposed national rail service to Fenchurch Street Station in under 20 minutes. With easy access to Lakeside, Romford, ad the A13, this area is perfect for commuters and lifestyle seekers alike, and the area is currently enjoying a healthy rental yield rate of 6.3%
Narrowly beating out Q1’s leading area (of Barking) for the third spot on this quarter’s charts is the East London area of Creekmouth. At 6%, the area is producing a strong yield despite being largely known for its industrial estate. This heavily industrial area is one of Dagenham’s greatest employment areas and is therefore popular with renters seeking convenience on a tight budget.
Across the rest of the capital, north London’s Ponders End and Freezywater in Enfield both offer a healthy yield of 5.7%.
The best yield in the west is 5.2% in Hayes and Harlington, and in the south, Eastfields offers an impressive 5.8%.
The top performers in the north and west of the capital share their attraction for the commuting populations as they await the long-anticipated arrival of the Crossrail trains. Meanwhile, Eastfields, in the south, has been benefiting from significant regeneration works being completed on Eastfields Estate, as well as neighbouring High Path and Ravensbury.
Sophie Durkin (MNAEA, MARLA), Portico Regional Director, says: “Thanks to the vaccination roll-out, Britain has been finally enjoying some return to normalcy. Rental demand has remained healthy and rental yields have consistently demonstrated a promising recovery through the past two quarters. Landlord instructions are also up 12% year-on-year, and tenant registrations have increased by a significant 22% from January 2021 to May 2021.
"Our latest rental yield research shows that there are certainly some healthy rental yields to be found in London - especially in areas experiencing significant regeneration and of course, those areas set to benefit greatly from Crossrail. East London is still the leading buy-to-let hotspot - and, as lockdown restrictions continue to ease, we expect demand from tenants to increase.”
