Where Are the Best Buy to Let Areas in Central London?
By Maurice Shasha | Created on 3rd November 2025
London can be a difficult place to find good buy-to-let investments. High property prices in sought-after areas often mean lower rental yields. Here, we look at which areas give the best return and offer tips to help you choose your investment property.
Buy-to-let landlords have certainly felt the impact of tax and legislation changes over recent years and may be wondering if residential letting in London continues to be a good investment.
Additionally, rental yields in London are lower than in other areas of the UK. The result is that capital postcodes seldom rank in the top 10 buy-to-let regions – but that’s not the whole picture. For example, St Johns Wood, Battersea and Paddington command average rental yields of around 5% and higher.
With rising property prices putting homeownership out of reach for many, demand for rental accommodation is only expected to rise. In the past decade alone, the proportion of private renters rose by 25%. Now, one-third of all London households rent privately.
We look at the best areas for buy-to-let property investment in London to assist your decision to invest in London residential property.
Why Invest In London?
Despite relatively lower yields, property investors are drawn to London’s rental market by high demand and house price trends. In the last five years, the average rents for new tenants in London has increased by 44%.
Purchasing a London buy-to-let property investment can be costly, and house price growth is predicted to slow in the short term. But long-term buy-to-let investments can still pay off. The property market remains attractive to buyers, and the city’s high prices mean that even modest growth can generate a respectable income.
What Is The Average Rental Yield In London?
The average rental yield in London is around 4.3% in 2025, but figures vary according to your property’s location and type. For a more accurate estimate, try doing your own calculations based on properties you’re considering. Read our guide to learn how to work out rental yield for property investments.
East London offers the highest rental yields, with several postcodes ranking in the top 20. In E3, covering Bow and Mile End, properties command as much as 6.5%. Investors can also find decent returns in North East London.
Average yields across E15, covering Stratford and West Ham, surpass 5.5%. West Ham has undergone significant regeneration following the London Olympics and the construction of the London Stadium.
E6 covering Hackney is not far behind the rental yields in West Ham, thanks to its popularity with young professionals. To achieve a similar return for a lower property price, look to East Ham (E9) where the average property price was just below £430,000 over the last year, and neighbouring Plaistow and Upton Park (E13).
Best buy-to-let locations in South London
South West London is a perennially popular place to rent. While high selling prices lower the average rental yields, landlords can enjoy a constant stream of suitable tenants, reducing the possibility of their properties lying vacant.
Kensington and Chelsea rental properties attract an average 4% yield yet boast a high occupancy rate. Multiple neighbourhoods hold longstanding appeal to high-net-worth buyers, and the terraced houses that define the local architecture sell for around £3 million.
Across the City of Westminster, buy-to-let investors can expect an average yield of around 4%. House prices in prestigious Belgravia continue to rise as buyers are drawn to the SW1W postcode. You will need a substantial deposit to enter the local property market with average property prices of over £3m, but long-term investors can benefit from consistent price growth.
Battersea is becoming a hotspot for property investors, boosted by the regeneration projects including new developments around Battersea Power Station. There is strong rental demand for properties for professionals, families and students with the appeal of waterside living and access to Battersea Park. Average rental yield in Battersea is 5.6% and average property prices have grown significantly faster than the London average.
In South East London, demand has been bolstered by Elizabeth Line connections. Thamesmead offers a high average rental yield of around 5.8% and the London mayor recently urged the Government to invest in extending the DLR to Thamesmead. The average property price in Thamesmead over the last 12 months was just over £370,000, making property significantly more affordable than many other areas of London.
Those who invest in property in New Cross (SE14) and Deptford (SE8) could see respectable rental yields of around 5.8%, with Walworth (SE17), Peckham (SE15) and Abbey Wood (SE2) averaging in the region of 5.5%.
West London contains some of the most sought-after addresses in London. Properties in these west central areas cost upwards of £2.5 million on average, which generally lowers the rental yield.
Marylebone properties cost an average of just under £2 million, with the area’s prestigious townhouses averaging double the figure. The average cost of a Mayfair apartment now exceeds £3 million. These areas are highly sought after for affluent renters, and they command the highest monthly rents. Living in prime central locations with luxury amenities is a top priority for high-net-worth individuals, ensuring consistent rental demand.
The average rental yield in Paddington is around 5%, with demand for high-end properties holding up. Rent has kept pace with house prices, though property investors will need a sizeable deposit to purchase a buy-to-let in the area. Excellent transport links from Paddington Station and amenities such as Hyde Park draw professionals to rent property in Paddington.
You may achieve a higher rental yield further west in Southall and Hayes, where rental yields average at around 5.5%. These areas could see good house price growth in future due to the impact of the Elizabeth Line.
Best Buy-To-Let Locations In North London
North London may not rank at the top of the property investment tables, but it still offers plenty of decent investment opportunities. In N17, Tottenham is one of the areas with the highest rental yields, with an average of 6.5%.
Ongoing regeneration projects in Edmonton (N18) have considerably raised the area’s profitability, with average rental yields now surpassing 5.5%.
St Johns Wood has an average rental yield of 5% and there is a high rental demand from families looking for high quality schools and the village-like feel. The area offers the close proximity to central amenities, while benefitting from a more tranquil and family-friendly environment.
What To Look For When Purchasing A Buy-To-Let Property In London
To help you decide if a location is suitable for your buy-to-let property investment, use our checklist of what to look out for when choosing your property.
Avoid traffic hotspots – Go back a street from the main road. Quieter streets with less traffic often hold their value better and are more attractive to tenants.
Look to the future – Research any planned regeneration schemes in the area and consider the impact on the property you’re thinking of buying. Will the plans bring better facilities or mean noisy works for years to come that will deter renters?
How are the schools? – Houses close to outstanding state and well-regarded independent schools will always be popular with renters and retain their value – but do your research. If you’re targeting families looking at popular state schools, find out how close you need to live to have a realistic chance of a place.
What are the main attractions? – Look at properties with good amenities close by. Attractive bars, restaurants and shops make a place appealing to tenants. Factors like a corner shop, neighbourhood pub and coffee shop can also give a particular street the edge.
How good are the transport links? – Be aware of the property’s walking distance to tube or train stations and the bus routes it’s served by.
If you’re considering purchasing a buy-to-let property in central London, we’d be happy to discuss the merits of different locations like Battersea and St Johns Wood, and share our many great properties. Contact us today to find out more.
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Maurice Shasha
The Property Industry has always and continues to interest me, and after joining Plaza Estates in 2008 I have experienced a market which has taught me alot. In my role advising clients on their purchases (together with our sales teams), managing the refurbishments for them (together with our management and design team), preparing the property for rentals (together with our rentals teams) or sales and being responsible for the Companies digital marketing I have seen the market from various aspects. The market is always changing and it is essential we constantly adapt, which since Plaza Estates was established in 1972 is something the company has always done. We pride ourselves in the personal relationship and service we have and give all our clients and being part of a company which is "big enough to cope and small enough to care" is something I really enjoy.
If you want 5-star reviews and want to remove negative reviews from Google, contact me via my profile; my contact details are listed there.
SM
Dear Eitan
In this whole sorry saga, with headbutting, unproactive lawyers, and a comatose estate agent etc etc, you have been a beacon of light throughout. Efficient, professional and responsive. This would never have got done without you.
Thank you.
All the best.
Maurice Shasha
We have been using Plaza Estates for many years for all our property requirements (sales, letting and management) and are delighted with the results and service they constantly deliver and provide!
KS
I generally dealt with the Marble Arch branch most of the time, but I can also say that the Knightsbridge office was also exceptionally helpful and professional on the occasions I did deal with them. Plaza Estates in general are excellent.
YZ
Have interacted with Plaza Estates across a couple of sites and always been impressed. Maurice must be the hardest working, most dedicated, helpful and knowledgeable account manager for any company anywhere! A real asset to the team!
LI
I have been a client of Plaza Estates for over 30 years and received excellent service. Both Rodney on the rental side and Fiona in the property management area have been have been attentive and helpful and always willing to go the extra mile on the few occasions when there were problems.
SA
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KR
We have owned our Flat since 2008, which we purchased through Plaza. Our relationship with Plaza goes back to 1982 when we purchased a nearby flat and Plaza have handled all our lettings since then. I would have no hesitation in recommending Plaza - they will find you a good tenant and ensure your ...
MS
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Thanks again for everything!
LT
Thank you for your kind help and your advice, it's been precious!
