Buy-to-let lending in the Midlands and northern England captured nearly half of all mortgaged purchases in the first half of this year, fresh Paragon Bank analysis shows. Lower property prices and stronger rental yields are drawing more investors north, steadily reshaping the UK’s private rental landscape.
Regional purchases reach decade high
The East and West Midlands, North West, North East and Yorkshire & Humber together made up 47.4% of new buy-to-let purchases with a mortgage between January and June, up from 46% a year earlier and just 33.5% a decade ago.
The North West now accounts for 12.9% of acquisitions, second only to the South East at 15.4%, and ahead of London’s 12% share. Yorkshire & Humber hit a record 9.5%, underlining how landlords are chasing value beyond the capital.
Louisa Sedgwick, Paragon Bank’s Managing Director of Mortgages, said: “These markets are appealing to landlords for several reasons, including the availability of appropriate stock, strong tenant demand, healthy local economies, lower purchase costs and generally stronger yields.”
London’s share continues to slip
London and the South East have seen their combined share of buy-to-let purchases drop from 41.6% in 2015 to 27.6% this year, while the South West eased to 6%. Wales and Scotland remain stable, with Wales at 3.5% of purchases and Scotland at 6.8%, both little changed over the past decade.
Sedgwick added: “The South East and London are still the UK’s most important rental markets. But without an increase in new stock, tenant choice is diminished and rental inflation will persist.”
Why landlords are heading north
Investors cite the stamp duty surcharge introduced in 2016 as a catalyst for seeking higher yields outside the capital. Northern and Midlands cities offer lower entry prices and, in many cases, gross yields comfortably above 6%, compared with typical London yields of 3–4%.
Sheffield landlord Paul Howard illustrates the trend: “I can buy a three-bed terrace for £140,000 and rent it at £900 a month. That’s double the yield of my old London flat—and far less hassle with voids or maintenance.”
Editor’s view
The numbers confirm what many landlords already sense: the centre of gravity for buy-to-let is shifting north. While London retains its economic clout, the combination of high prices, tax pressure and strong northern yields is hard to ignore. Unless the capital sees a meaningful boost in rental supply, investors looking for sustainable returns may keep heading up the M1.
