The claim from Gráinne Gilmore, Knight Frank’s Head of UK Residential Research, comes after statistics demonstrated that yields in regional locations outgrew those in London during Q2 2014.
The North West was the best performing region, with Leeds posting the highest average growth yields of 8.2% throughout the UK, and Manchester posting the third highest yields of 7.9%.
Birmingham and Glasgow made up the rest of the top four, posting yields of 8.1% and 7.8% respectively; all of which firmly out-shadow the 4.3% yields seen in central London.
Although yields in the outer parts of London represent a slightly brighter picture standing at 5% and 6.6% respectively, they still fall way behind those seen in regional locations.
The average net yield across the index stood at 4%, representing a general rise in rents of 2.6% across the UK in the year to Q2.
The report also highlighted the pace of capital growth for investment-grade rented blocks, which has advanced to 7.3% in the year to the end of Q2 2014, up from 6.4% in the year to the end of Q4 2013.
The outer zones of London experienced the biggest growth in capital values, while the cities of Manchester and Birmingham saw growth of 3.5% and 4% respectively.
To read the full report click here.