We’ve had a look at the best UK hotspots for property investment across the UK. Our top ten shows where it’s best to invest money for guaranteed demand and the highest capital growth.
The market has become used to inflated prices in the south east and London and savvy investors are looking away from the traditional investment regions towards the north. Infrastructure improvements courtesy of the Northern Powerhouse are starting to show results. Recent reports from KPMG show that the North West, North East and Yorkshire will all see some of the highest average house price growth over the next ten years. Check out our top ten.
Just five miles from Leeds, Bradford is often in its shadow, but it’s an affordable area going through its own period of regeneration. It’s more of a large town than a true city and is full of typical northern-street terraced houses and Victorian homes with bay windows. You can buy a one-bed flat for just £40,000, while a stone-built terrace will cost about £70,000. Landlords can expect yields of 8% on two-bed homes in the affordable postcodes BD7 and 8.
Manchester is the fastest-growing city outside of London and is home some impressive regeneration projects. These are led by the Salford Quays media complex and the digitally-orientated Northern Quarter. There’s no doubt that 2018 is a good time to invest in property in Manchester, with high ROIs in areas such as Chorlton, Salford and Fallowfield. Prices are rising fast and yields are around twice those in London. About half of the housing stock is private rents, and the massive student population underpins demand for flats.
Another northern city benefiting from inward investment and large-scale job creation, Liverpool is also on the up. Flagship projects include the Liverpool Waters scheme, which has cost around £5 billion. This will transform a massive brownfield site into five new neighbourhoods. Property investment in Liverpool centres around a young, keen workforce looking for long term rentals. Average house prices are on the lower end but are increasing.
Leeds is a shining star of the Northern Powerhouse, having come to the end of a long process of gentrification. It’s now a stylish, ultra-modern city with an impressive amount of housing. As it shares an airport with Bradford and will benefit from HS2, it has garnered the attention of overseas investors buying up new builds. However, there are good capital growth opportunities, with areas LS1 and LS11 working well for city workers, and the further out LS6 and LS8 achieving high yields.
The second biggest city in the UK is the heart of the country and home to 4.5 million. There is a real shortage of rental accommodation, which is pushing property prices up. Demand is particularly strong in areas like Edgbaston and Halesowen, and any cash buyers could do well out of non-traditional properties in areas like Kings Norton.
Demand is outweighing supply at the moment in this South Yorkshire city. It’s likely that Sheffield, along with Bradford, will benefit from prices increases in Leeds as first-time buyers become priced out of the market. The S1/S2 postcodes offer some of the highest rental yields in the country. Prices have tripled since 2001, but it’s perfect for investors looking to add to their portfolio with on-street terraces for £50,000 or three-bed ex council houses for £75,000.
Hull has one of the highest proportions of young people in the UK, thanks to the investment in digital tech and windpower the city has enjoyed since it was 2017’s City of Culture. Student lettings return high yields and it’s likely that price growth and steady demand for rentals will continue to make Hull popular for buy-to-let investors.
Analysis last year suggested that Newcastle and the North East (including Gateshead, Sunderland, North and South Shields) will house England’s most affordable properties over the coming decades. While capital growth isn’t an incentive here right now, it could be a wise long-term portfolio investment.
Nottingham is often overlooked but has the UK’s seventh biggest economy and is likely to benefit from the proposed HS2 station. Extensions to the tram network have seen prices increase in suburbs like Wilford, Beeston and Clifton.
Leicester’s economy is bigger than Nottingham’s and is home to many household brand name companies. This means inward migration of young professionals, and house prices rose throughout 2017. Semi-detached and terraced houses are particularly in demand, with the best areas to invest in buy-to-let include LE3, where you could get a terrace with yields over 5%.