Cambridge has been identified as the worst UK city to be a landlord in 2026, according to new research from Landlord Resource. The study, which analysed average monthly rents, typical house prices, and average gross rental yields, found that landlords in the university city face the lowest returns, with a gross rental yield of just 4.7%.
Low yields in southern cities
The research revealed that Cambridge tenants pay an average of £1,600 per month, while the average property price stands at £408,709. This combination results in a rental yield of 4.7%, the lowest among all UK cities surveyed. Oxford follows closely behind, with tenants paying £1,778 per month, an average property price of £424,755, and a yield of 5%.
London ranks third, despite having the highest average monthly rent at £2,119. The average property price in the capital is £494,542, yielding 5.1%. However, some London boroughs offer better prospects, including Barking and Dagenham (6.22%), Newham (6%), and Bexley (5.8%).
Regional variations in rental yields
The research also highlighted significant regional differences. The North East leads with an average gross rental yield of 7.9%, followed by Scotland at 7.6%, the North West at 6.8%, and Yorkshire and the Humber at 6.5%. Wales and the West Midlands both average 6.5% and 6.2% respectively, while the East Midlands stands at 6%. The South East averages 5.5%, and London trails at 5.1%.
In York, the average yield is 5.3%, with rents averaging £1,150 and property prices at £262,055. Southend ranks fifth, with rents of £1,225, property prices of £268,662, and a yield of 5.5%. Brighton, Reading, Bristol, Milton Keynes, and Worthing also feature in the top 10 lowest-yielding cities, with yields ranging from 5.5% to 5.8%.
Northern cities offer higher yields
The classic north-south divide in house prices works in favour of landlords in northern cities. Glasgow boasts a yield of 7.8%, while Liverpool stands at 7.7%. According to the research, high rents are not the primary driver of these yields; rather, it is the lower cost of housing in these areas.
For instance, Sunderland has a rental yield of 9.3%, with average monthly rents of £659—less than half the London rate—because the average home costs just £85,000. Aberdeen follows with an 8.3% yield, Burnley at 8.2%, Dundee and Middlesbrough at 8.1%, and Hull at 8%.
Impact on tenants and housing stock
Despite the challenges for landlords, the research notes that conditions for tenants have improved following the introduction of the first phase of the Renters’ Rights Act in May. The legislation limits rent increases to once a year and in line with market rates, ends Section 21 'no-fault' evictions, eradicates bidding wars, and prohibits discrimination against renters on benefits.
However, renters continue to face difficulties. In London alone, 30.1% of properties are now private rentals, the highest percentage since 1971. The availability of council housing has also declined sharply. A 2024 study from Shelter found that while more than 200,000 social rent homes were built in England in the mid-1950s, by 2023 to 2024, that number had fallen to just 10,000.
The Right To Buy policy, introduced in 1980, has further reduced council housing stock. Statistics from the New Economics Foundation (NEF) indicate that more than four in 10 council homes sold under Right To Buy are now owned by private landlords, the same group that is now reportedly struggling with lower yields.
