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Cheapest Place to Buy a House in the UK

So what is the cheapest place to buy a house in the UK, and more importantly, which areas offer affordable properties but in areas that are highly desirable? We take a look at some of the bargain-priced homes in the UK right now.

In the second half of 2020, house price growth in the UK began to accelerate. This increase coincided with the start of the Stamp Duty tax exemption which began on 8th July 2020. The exemption meant that properties up to the value of £500,000 would incur no tax, and as a result, we saw many sellers across the country requesting higher prices as the overall cost for buyers was reduced.

The UK property market saw a flurry of activity as the housing market reopened following a series of lockdowns and the Stamp Duty Holiday made buying and selling more attractive. Price houses in the UK have increased to their highest level ever recorded, and in June 2021, the average UK property price reached £266,000 – £31,000 higher than the same month in 2020.

With the return of the Stamp Duty tax to its previous thresholds from October 2021, those seeking a property, especially for buyers in the South East and other hotspots in London, find it particularly hard to get onto the property ladder. More than ever buyers are looking to areas where they can get more for their money, and first-time buyers are looking for affordable properties that can help them get on the property ladder.

UK Market Trends and Property Prices

The UK housing market is not homogenous and different areas are experiencing different levels of growth.

The North West of England saw the highest annual house price growth, with prices increasing by 18.6% from June 2020 – June 2021. The North East has the lowest average price at around £150,000, making the region home to some of the cheapest properties in the UK. London has the lowest annual growth of house prices in the UK at 6.3%, while house prices remain the most expensive in any region, sitting at £510,000 in June 2021.

A growing house price to rent ratio has meant that renting is currently more affordable than buying a house with a mortgage, and in big cities, in particular, the demand for affordable rental real estate is high.

UK market trends and property prices

Where is the Cheapest Place to Buy a House in the UK?

In the current climate of high property prices and with the economic impact of the Coronavirus, for many, purchasing a property is more challenging. But where are the cheapest places to buy a house in the UK right now? According to Propetydata, here are the top 20 places that are home to the cheapest property in the UK.

Middlesbrough, TS1, £54,978

Bradford, BD1, £58,673

Sunderland, SR1, £65,478

Grimsby, DN31, £71,105

Shildon, DL4, £73,637

Middlesbrough, TS3, £80,958

Peterlee, SR8 £85,274

Stanley, DH9,  £91,391

Lancashire, BB11, £91,516

Liverpool, L20, £91,793

Keighley, BD21, £91,833

Birkenhead, CH41, £91,885

Kingston upon Hull, HU9, £92,755

Sunderland, SR5, £93,222

Ferryhill, DL17, £95,380

Blackpool, FY1, £95,526

Hull, HU3, £97,043

Grimsby, DN32, £97,652

Liverpool, L5, £97,744

Seaton Carew, £100,603

Where is the Cheapest and Nicest place to Live in the UK?

For many property seekers, it’s not just about buying the cheapest house and getting on the property ladder. It’s important to find a property located in a desirable area that offers a high quality of life as well as the prospect of making money on the property when it comes to the sale, or if you want to generate monthly returns you’ll want something located in the best buy-to-let areas.

Cities in the North are home to many of the UK’s cheapest properties, which can allow investors to stretch their budgets. At the same time, many of the UK’s northern cities are up and coming, receiving substantial investment and undergoing regeneration which is making them highly liveable and sought after.

Below, we look at some of the cheapest places to buy a house in the UK and outline the Northern cities that should be on your radar. Each of these cities will be more desirable to buy-to-let investors as they offer a strong rental market and rising property prices that suggest decent capital gains are to be made.

cheapest property in Bradford city

Bradford

In Bradford it’s possible to find property in the city centre BD1 postcode for less than £60,000. The city is just 10 miles from Leeds and it offers a strategic location within the Northern Powerhouse – the UK government’s vision for a connected and globally competitive Northern economy. Bradford is supported by strong air, road and rail connections and for those looking for a cheaper place to live, or priced out of the surrounding cities, Bradford is an attractive option for commuters and first-time buyers.

In the last 10 years investment into Bradford has transformed public spaces, the residential sector and the city’s infrastructure with investment reaching around £10 billion. For example, the HS2 project, the UK’s high-speed rail line, will put Manchester just 20 minutes away from Bradford by train. Bradford allows investors to take advantage of cheaper house prices with all the benefits of connection to larger cities in the region. HS2 is expected to add £15 billion to Bradford’s economy by 2069 and the knock-on effect on house prices is expected to be significant.

For investors looking to snap up a buy-to-let bargain, Bradford also offers attractive yields and was named within the top 10 best buy-to-let areas in the UK. Some properties in the BD1 area can deliver yields between 8-10%.

cheap property pool Liverpool

Liverpool

In recent decades, a far-reaching regeneration scheme has transformed Liverpool into one of the UK’s leading cities and a hub for culture and business. House prices are significantly behind the UK national average, however, they are on the rise as buy-to-let investors seek out new, growing markets, and first-time buyer’s schemes help more people get onto the property ladder.

Property in Liverpool is currently under hot pursuit, and the city is a great place to work, live and play with plenty of growing businesses, an iconic waterfront, galleries and heritage sites. For those seeking out an affordable property, there are a number of reasonably-priced three-bedroom properties in the Netherton area that can be had for between £80,000 to £90,000.

In terms of a rental market, Liverpool is home to some of the UK’s best buy-to-let areas, and many postcodes in Liverpool offer highly attractive rental yields. For example: L7 with 10.3% yields; L6 with 8.4% yields; L1 with 8.1%; L15 and L4 both with 7.4% yields. Considering the UK average rental yield sits at around 5% and London’s at 3%, Liverpool is highly attractive for investors looking to make a monthly profit. Adding to the appeal of Liverpool’s buy-to-let rental market, the city is home to a number of world-renowned universities – including the University of Liverpool, Liverpool John Moores University, Liverpool Hope University and Edge Hill University – which produce a pipeline of over 30,000 graduates each year and many students looking for quality accommodation in the city.

Leeds cheap real-estate options

Leeds

Leeds is one of the top and most sought-after cities to live and work which continues to be transformed by incoming investment. Leeds offers investors strong rental yields and relatively cheap property.

The UK’s third-largest metropolitan area by population, in the last 10 years, Leeds’ population has increased 151% – seven times that of London. Leeds is the key contributor to UK GDP out of the Northern Powerhouse cities, and is known as the “digital capital of the North”.

Leeds offers a number of comfortable properties that can be had for around £100,000. In the Harehills area, attractive three-bed properties can be found for between £95,000 to £105,000. As well as a thriving residential rental market, Leeds is one of the most popular cities for students, making the city one of the best buy-to-let areas for investors looking to target the student market.

cheapest properties for sale Birmingham

Birmingham

Known as the UK’s second city and home to 2.5 million people in the metropolitan area, Birmingham is located at the heart of the UK. Boasting unrivalled transport links, London is just 90 minutes by train and it’s possible to get to the UK’s main Northern cities in under 2 hours or less. Birmingham is the eighth largest economy in England with a value of over £9.5bn and the city’s economy is expected to increase around 25% in the next decade, making investing in property a great way to capitalise on economic growth.

In the years 2016-2021, Birmingham had the highest property growth prices of any UK location. In 2022, it’s expected that Birmingham will see some of the strongest house price growth through 2025 of between 14.2% – 17%. In the cheaper parts of Birmingham, property prices have leapt by up to 40% since the start of 2021, but only time will tell if this will remain sustainable with the end of the stamp duty holiday (you can read more about UK house price predictions in 2021 and 2022 here ).

Currently three-bedroom houses in areas like Erdingon and Handsworth can be had for around £140,000. Low property prices and a strong rental market put the city’s average rental yields at 5.4% – 6%. The BD5 area can achieve yields of 5-6% and some of the student areas on the city’s east side can be particularly lucrative, reaching up to 11%. Overall, rents are on the rise too, set to grow by 10% over the next four years.

cheapest property to buy in Luton

Luton

While not a Northern city, and by no means one of the cheapest places in the UK to buy a house, Luton deserves a mention due to its affordability as a commuter town for London and as it’s status as an up and coming property hotspot.

The closer property is to a major city, especially London, the more house prices increase, as a result, many property investors and buyers are looking to satellite cities to get more for their money. Luton is one to watch as a commuter belt town, and commuters can save an average of £483,342 by commuting up to an hour each day rather than renting property in the UK capital. Luton has the most affordable properties of any city in London’s commuter belt (including Basingstoke, Gravesend Windsor and Northampton) with average property prices of £261,725 as well as the fastest commute time by train to central London out of the commuter belt cities.

Where is the Cheapest Rural Property in the UK?

With the Covid Pandemic and the several national lockdowns, there was a shift in the way we think about work and living, and many people are rethinking their priorities for the type of housing they seek out and its location.

With many employers now allowing their employees to work remotely, the desire for properties in the UK has shifted, with greater desire for space and places away from the city that can offer a different quality of life. With an attractive pace of life, more open space and fresh air, in the past year we have seen more people seek out a place in the countryside. As a result of this demand, property prices in rural areas are increasing faster than those in urban areas – over a five-year period, the average property price in urban areas increased 17.5%, compared with 20.8% in rural areas.

Even with the end of the Stamp Duty holiday, many are keeping their urban properties and purchasing a second property in rural locations in order to be able to escape to the country when they feel like it. If this is something you have in mind, don’t miss our top tips on how to avoid paying stamp duty on a second home. So where is the cheapest rural property in the UK? The most affordable rural area to buy is currently County Durham, which has average house prices of £109,980.

When it comes to the cheapest place to buy a house in the UK, it’s important to not only consider the property cost, but whether it’s in a desirable location that can make it attractive as a buy-to-let investment or a property that can deliver returns when it comes to a sale. For more information on the cheapest place to buy a house in the UK, get in touch with our experts today.