Leeds among UK’s top cities for flat investment
Landlords in Leeds are reaping some of the biggest rewards in the UK property market, with rental income paying off their deposit in under two years.
Buying a flat in Leeds could be a smart choice for property investors looking for consistent returns. A new study by Optimise Accountants Limited has revealed that the city, ranked number thirteen in the UK, offers strong payback periods for landlords, coming just behind Southampton while outperforming larger cities such as London and Manchester.
The research looked at average prices and rental values for one-bedroom flats across major UK cities, assuming a 15% deposit. By comparing gross rental yields and the time it takes for rental income to cover that deposit, the study shows where investors can expect solid returns and where payback takes longer.
According to the findings, Leeds landlords can recoup their deposit in just 19.6 months, with a gross annual yield of 9.2%.
Newport comes out on top, with landlords recouping their deposit in just 14.1 months, followed closely by Sunderland (15 months) and Chester (15.4 months). Other strong performers include Coventry (16.2 months), Plymouth (17.9), Bradford (18.1), Dundee City (18.3), Lancaster (18.7), Wakefield (18.8), and Sheffield (19 months). These cities all offer double-digit or near double-digit gross annual yields
At the other end of the scale, more expensive markets like London, Oxford, and Brighton offer much lower yields, with landlords waiting several years to earn back their deposit. The slowest city on the list, Armagh, would take around 70 months, nearly six years, to see a return.
Top 20 cities where your flat pays for itself fastest:
| Rank | City | Months to recoup deposit | Gross annual yield (%) |
| 1 | Newport | 14.1 | 12.7 |
| 2 | Sunderland | 15.0 | 12.0 |
| 3 | Chester | 15.4 | 11.7 |
| 4 | Coventry | 16.2 | 11.1 |
| 5 | Plymouth | 17.9 | 10.1 |
| 6 | Bradford | 18.1 | 10.0 |
| 7 | Dundee City | 18.3 | 9.9 |
| 8 | Lancaster | 18.7 | 9.6 |
| 9 | Wakefield | 18.8 | 9.6 |
| 10 | Sheffield | 19.0 | 9.5 |
| 11 | Newcastle upon Tyne | 19.2 | 9.4 |
| 12 | Southampton | 19.4 | 9.3 |
| 13 | Leeds | 19.6 | 9.2 |
| 14 | Preston | 19.7 | 9.1 |
| 15 | Worcester | 19.8 | 9.1 |
| 16 | Stirling | 20.0 | 9.0 |
| 16 | Portsmouth | 20.0 | 9.0 |
| 16 | Glasgow City | 20.0 | 9.0 |
| 19 | Milton Keynes | 20.2 | 8.9 |
| 19 | Chichester | 20.2 | 8.9 |
The study compared one-bedroom flats across 65 UK cities. Using average property prices and rental values, they assumed a 15% deposit for each property. The key metrics were how much rental income a property generates each year as a percentage of its price, and how long it takes for rent to cover that initial deposit.
In simple terms, the higher the yield, the faster investors make their money back
Sources
Zoopla
Numbeo