Is Cambridge or Luton better for buy-to-let?

Luton has the higher average gross yield at 5.8%, while Luton has the lower average purchase price at £295,000. Higher-yield markets suit cash-flow investors; lower-yield, higher-price markets tend to be capital-growth plays.

What is the average rental yield in Cambridge?

The average gross rental yield in Cambridge is approximately 3.8%. On a typical £545,000 property that works out at roughly £1,726 per month in rent before mortgage costs, letting fees, insurance and maintenance. Net yield after costs is usually 1.5–2.5 percentage points lower.

What is the average rental yield in Luton?

The average gross rental yield in Luton is approximately 5.8%. On a typical £295,000 property that works out at roughly £1,426 per month in rent before mortgage costs, letting fees, insurance and maintenance. Net yield after costs is usually 1.5–2.5 percentage points lower.

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Location comparison

Cambridge vs Luton for Property Investment

Luton leads on gross yield at 5.8%, while Luton has the lower entry price at £295,000. Here is how the two markets compare on yield, price, deposit and tenant demand.

Cambridge vs Luton at a glance

Metric	Cambridge	Luton
Average gross yield	3.8%	5.8%
Average property price	£545,000	£295,000
Implied monthly rent	£1,726	£1,426
25% deposit	£136,250	£73,750
Stamp duty (additional property)	£42,000	£17,000
Population	145,000	215,000
Region	East of England	East of England
Investor rating	Average	Good

Cambridge

The market skews towards period houses, detached family homes and premium new-build apartments, so entry prices sit well above the national average. Tenant demand is underpinned by a large student population, local employment in services, healthcare and logistics, supported by a population of around 145,000. On the average £545,000 purchase, a 3.8% gross yield implies roughly £1,726 per calendar month in rent — a useful sanity check when you are reviewing a listing. World-class university and tech hub with premium prices.

Consider carefully
Standard buy-to-let
Strong fit
HMO / rent by the room
Consider carefully
First-time landlord

Full Cambridge guide

Luton

Expect a spread of semi-detached family homes, period conversions and new-build apartment schemes, with terraces concentrated in the older inner areas. Tenant demand is underpinned by local employment in services, healthcare and logistics, supported by a population of around 215,000. On the average £295,000 purchase, a 5.8% gross yield implies roughly £1,426 per calendar month in rent — a useful sanity check when you are reviewing a listing. Airport driving employment and rental demand.

Workable
Standard buy-to-let
Workable
HMO / rent by the room
Workable
First-time landlord

Full Luton guide

Which is the better investment?

If monthly cash flow is your priority, Luton is the stronger option on paper at 5.8% gross. If you want the lower capital commitment, Luton needs around £73,750 as a 25% deposit. Averages only take you so far, though — run the actual listing through PropertyROI before you offer.

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