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Rising rents and softening house prices have pushed up yields across the UK, according to the latest figures.

On average, yields for the second half of last year reached 5.9 per cent, the first appreciation since 2015, while London yields rose to 4.6 per cent as property prices dipped by 3.8 per cent in the year to February 2019. “Rental growth in London started picking up in the second half of 2018,” said property research director Aneisha Beveridge.

Yields outside London are increasingly attractive to property investors, who are cautious about the near-term future of the London market. Almost 60 per cent of London-based landlords now invest outside the capital, says a new report, compared with just 25 per cent in 2010. Buy-to-let properties in the Midlands and the north of England are in demand, with yields in locations such as Hartlepool reaching 11 per cent, closely followed by Pendle and County Durham.

“London landlords are going a lot further to try and catch those high yields and get that regular stream of income,” said Beveridge. The sector has been under pressure in recent years from regulatory changes, including higher stamp duty on second homes and the loss of tax relief on mortgage interest payments.

Nevertheless, rental growth in London is expected to continue, as home buyers face high deposit costs and income multiples.