Private rented sector yields held steady in London while decreasing in the regions over the summer as more investment spread outside the capital, according to data from CBRE.

The data covered residential investment yields over the three months to the end of September.

London’s zone 2 yields across the prime markets held steady at 4.25% gross and 3.25% net. Secondary markets also remained stable at 5.75% gross.

The stability came as ready-to-let properties remained hard to come by and development deals took time to come to fruition, according to Jason Hardman, senior director in the residential valuation and advisory team at CBRE.

Further out in London and in the South East the secondary markets were the only areas to see yields harden marginally compared with the previous quarter, but to the nearest 0.25% yields remained static at 7%.

Hardman said this was because “there is a broadening out of location where investors are looking, into the more secondary areas, but they are still locations with strong fundamentals in terms of demand.”

This has been providing new entrants such as Greystar and existing players such as M&G Real Estate greater opportunity for investment, he said.

Regional centres such as Liverpool have seen more deals complete over the summer, helping to drive yields down marginally over the quarter. To the nearest 0.25% they remained at 7.75%. A prime example is the £50m forward funding agreement by Vista Fund, a joint venture between Hermes and Countrywide for Baltic Village in Liverpool.

Secondary regional deals have been rare but yields have shown signs of hardening across prime (7.5%) and secondary sectors (10%) as investors look more closely at the market, although yields remained steady rounded to the nearest 0.25%.

Hardman said: “There haven’t been any landmark deals in those locations, but the point is that investors are beginning to look at those locations because pricing is going to help yield better returns, but also by broadening the net they are identifying more opportunities.”