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Report: Rental yield and tenant demand Q1 2022
According to our most recent research, carried out in March 2022 in partnership with BVA BDRC, an all-time-high proportion of landlords, 62%, are reporting that tenant demand has grown, as cities recover from the Pandemic lockdowns.
![House Bank Article](/media/mzjeqaib/house-bank-article.png?anchor=center&mode=crop&width=1024&height=720&rnd=133099657833470000)
Landlord confidence has risen overall, especially in their expectations for rental yields and tenant demand.
Landlords in the South-West, Central London and Wales were experiencing the highest level of tenant demand with London experiencing significant improvement since the pandemic, where 30% more landlords are now reporting an increase since Q2 of 2021.
Overall, Tenant demand over all regions were increasingly strong in March with only 2% of landlords reporting that they think tenant demand is presently weak.
However, in contrast, the same research revealed that the average rental yield had dropped by 0.5% and now stands as 5.5% in Q1 2022, compared to Q4 2021 when it was 6.0%. This made it the lowest percentage recorded since 2020. However, this contrast may be due to the delay between tenant demand and the receipt of the first rent, or indeed a full annual rent for yield calculation purposes.
The regions Wales and the North East continue to establish the highest rental yields despite small declines of 0.9% and 0.8% respectively this quarter, with London landlords reporting the lowest.
Landlords with HMOs continues to achieve the highest rental yields at an average of 6.8%, and the highest paying tenant type is migrant workers.
The report also revealed that 1 in 4 landlords do not know what their rental yield is, demonstrating the importance of the continued availability for expert advice from professionals.
Naturally, in this fast-paced economy, we can expect a great deal of change, so please return for our next quarterly report which will be available from mid-July.
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