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In recent years, rental prices have increased exponentially, with renters spending, on average, 29% of their annual salary on property rent. The number of properties occupied by private renters has been increasing gradually since 2000 which is potentially great news if you’re a landlord.

About a fifth of families in the UK currently rent rather than own their property. With the future of property uncertain, experts at Inventory Base have produced a report analysing the current state of the renting and buy-to-let market for both tenants and landlords.

Read on to discover our findings. 

Key Findings 

  • English renters spend, on average 29.6% of their yearly income on rent, representing a slight decrease of 1.33% when compared to 2021. 
  • Those residing and working in Worcester had the smallest disparity between annual income and money spent on rent, with annual rent just 19.9% of annual income. 
  • Newcastle provides the highest rental yield of any city in England, with an estimated return of 7.2%. 

City Analysis 

Highest Rental Yield by City: Mapped 

CityAverage Rent Per MonthAverage House PriceEstimated Rental Yield (%)
Newcastle 1200199 1107.2
Durham1100200 1036.6
Salford 1300247 1916.3
Exeter 1600320 7466
Birmingham1200254 4255.7
Lancaster867192 6855.4
Portsmouth1200271 5285.3
Manchester1250283 131 5.3
Preston800183 2364.2
Nottingham1000235 1584.1

According to our data, rental yield is currently highest in Newcastle, with an estimated rental yield of 7.2%. Durham, Salford, and Exeter also ranked highly.

Lowest Rental Yield by City

CityAverage Rent Per MonthAverage House PriceEstimated Rental Yield (%)
Winchester1175605 6882.3
Worcester550265 4772.5
St Albans1575642 6883
Bath1500589 2423.1
London1945711 8623.3
Plymouth628228 2493.3
Lichfield975334 1063.5
Leicester800266 4953.6
Doncaster530171 822 3.7

Winchester is currently the city with the lowest expected rental yield, with a gross rental yield of just 2.3%. In Winchester, rental prices are comparatively low but the average cost of buying a house is high. The majority of cities with a low rental yield are located in the south of England. Chester, Lichfield and Doncaster are the only cities north of the West Midlands to feature in this table.

Rent as a Percentage of Income by City

CityAverage Rent Per MonthAverage Annual PayRent as Percentage of Income (%)
Oxford220040 40065.3
St Albans157532 10058.9
Exeter160033 10058
Brighton155536 30051.4
Bath150035 30051
Cambridge 190046 90048.6
Chichester135033 80048
Bristol150038 30047
Canterbury120030 90046.6

Residents of Oxford spend the largest proportion of their monthly salary on rent, with a property costing, on average, £2200 per month. Residents of St Albans and Exeteralso spent an extortionate amount on rent. 2022 represents the largest increase in average rental costs in five years.

In the last 12 months, rent has increased by more than 2% for millions of tenants across the UK. In Manchester, rental prices have increased by a jaw-dropping 23.4% in the last year alone again making it a potentially good option for landlords to consider.

Who spends the least on rent each year?

CityAverage Rent Per MonthAverage Annual PayRent as Percentage of Income (%)
Worcester55033 20019.9
Doncaster53030 70020.7
Stoke-on-Trent55031 80020.8
Carlisle53830 40021.2
Derby73840 50021.9
Sunderland59529 20024.5
Plymouth62829 80025.3
Wakefield73534 70025.4
Bradford67531 70025.6
Hull59527 90025.6

Residents of Worcester currently spend the smallest portion of their monthly salary on housing, with rents costing, on average, just 19.9% of their monthly salary. Doncaster, Stoke-on-Trent and Carlisle are also excellent options for families looking to rent.