What is the average yield in Newcastle?

Newcastle upon Tyne is one of the most famous cities in North East England.

The city has a unique character, given by the River Tyne and the sea that make it an attractive property investment opportunity. 

The City of Newcastle is a medium-sized city, having a population of 292,200 as of 2010, and it is now the capital of this area of England. Back in the days, the town used to be an industrial place with an economy sustained by coal mining and shipbuilding. However, the city’s economy saw a significant shift over the past years, attracting employers from all areas, from the public sector to financial, professional services, constructions, and more. Besides that, the city is an interesting property investment because it is a place very attractive to students. 

If you’re planning to invest in properties in this area, you’re probably interested in learning more about the return you’d get. So, you’re likely wondering what the average rental yield in Newcastle here. Keep reading below to find out! 

Rental yield, explained. 

First, let’s make sure we’re on the same page with what rental yield is in general. It represents the amount of money a property investor gets on a property they’ve invested in by calculating the gap between the overall costs and the income received when renting out the property. This gives property investors a better idea of the ongoing return they can potentially earn from their investment. When calculating the rental yield, investors don’t also consider the costs they pay for the maintenance of the property or the annual taxes paid. They only consider the money they earn as rent on a year period. 

What is the average rental yield in Newcastle? 

If you own a property in Newcastle and plan to rent it out, or you plan to purchase a property for renting purposes, you need to know what the average rental yield in the city is. The average rental yield is 5.9% across the city as a whole, according to ONS. However, the annual average rental yield can grow to circa 7.0% and even up to 8% in the more active areas of the City of Newcastle. Yet, the average rental yield in the city is only a rough estimation you can use for guidance.

Yields can differ depending on the size of the property, the type, and the area where it is located. So, it can depend on multiple factors. For example, a rental yield of 8-9% is typical in Heaton and Sandyford HMOs. However, it drops to 6-7% in Jesmond. What’s more, for example, one beds in the City can have a rental yield of 6-8%, and two beds can drop to around 5-7%.

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