Aspen Woolf on 2018’s top ten property hotspots in the UK

Leeds City Skyline view

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.

  1. Bradford

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 as little as £75,000! Landlords can expect yields of 8% on two-bed homes in the affordable postcodes BD7 and 8.

  1. Manchester

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.

  1. Liverpool

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.

  1. Leeds

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.

  1. Birmingham

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.

  1. Sheffield

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.

  1. Hull

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.

  1. Newcastle-upon-Tyne

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.

  1. Nottingham

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.

  1. Leicester

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%.

Aspen Woolf looks at the most expensive versus the cheapest property in Leeds

For Sale Signs - Aspen Woolf

The North of England is having a resurgence in terms of regeneration, property development and a growing job market. There are more reasons than ever to invest in property in cities such as Leeds, Liverpool and Manchester, led by the Northern Powerhouse initiative.

Particularly since the vote to leave the European Union in June 2016, property investment across the UK has experienced a sea change. More and more investors are turning away from London and the South East as economic and political uncertainty shake a previously unwavering property market and setting their sights further up north.

Property hotspot

Leeds has become a prime property hotspot, thanks to a steady stream of city-centre regeneration and funding, along with a solid and thriving job market. Add in a bustling city centre packed with all the amenities young professionals look for, and a strong student population, it’s not surprising that investment in Leeds is constantly increasing.

At Aspen Woolf, we keep an eye on all the property investment news across cities including Leeds and have examined recent sales to get a picture of the kinds of prices people can expect.

Variety of property

The cheapest residential property that completed in March this year sold for just £36,500. At the other end of the scale, the buyers of the most expensive property sold in March paid more than 26 times this price.

This shows the sheer variety of options for people looking for property in Leeds. Whether investors are searching for the perfect buy-to-let property, or families are looking to move into a larger house, there is a scale of pricing available that isn’t seen in regions further south.Land Registry figures

The figures from HM Land Registry for March 2018 show that some property investors paid a lot of money for truly stunning properties situated in the city’s suburbs, while other people sought out and found bargains closer to the city centre.

The most expensive home sold in March was a detached house in the Boston Spa area of Leeds. It was sold for an impressive £975,000, providing a stark contrast with the cheapest flat sold for just £36,500.

UK-wide, across the same period, more than 90,000 homes were sold. The most expensive residential property on record sold for £15 million and is located in the London suburb of Barnet. The cheapest of all went for £20,000 in County Durham. This provides a good scale to measure Leeds prices by.

Detached properties

A closer look at what buyers in Leeds secured for their money can be seen by detailing some of the sales below. As mentioned, the most expensive property was located in Boston Spa. For £975,000 the buyer enjoyed a five-bedroom detached house in this leafy suburb of Leeds. Next on the list was another five-bed detached property in Foxhill Drive, Leeds, which sold for £747,000.

Another five-bed detached family home, this time in the Adel area of Leeds, sold for £650,000 and a four-bed detached home in Boston Spa went for £521,555. A lovely four-bed home in the outlying Leeds village of Shadwell sold for £515,000 and another Adel four-bed detached went for £499,995.

Bargain buys

Turning towards the cheaper end of the market, the biggest bargain was the flat sold for £36,500 in the Hunslet area of Leeds. Another flat in Lower Wortley sold for £37,250 and a terraced two-bed home for £40,000 in Lascelles Place.

No matter what kind of property buyers are looking for, Leeds is a good place to look. From apartments close to the always improving city centre amenities, to large detached homes in green suburbs, the variety available is comparable to that in the South East, but for much more affordable prices.

Aspen Woolf On Why Property Investment In The North-West Has Doubled

Manchester town hall

There has been a huge rise in commercial property investment in the north-west of England. Investors have increasingly come to realise the value of some of the key areas in the north, including Liverpool.

Thanks to this awareness and understanding, along with the benefits from the Northern Powerhouse initiative, investors have increased their interest to a record high.

Figures Increased

During Q1 2018, the volumes of investment in cities like Liverpool has leapt to £965 million according to figures released by UK Investment Transactions. This is more than twice the amount achieved in Q1 2017, which peaked at £440 million.

This is a phenomenal start to the year in terms of property investment and is thanks largely to two main deals. The first came when L&G bought Liverpool’s India Buildings for £125 million, and the second with Aviva’s acquisition of 2 New Bailey in the Salford area of Manchester. The latter deal was worth £113 million, and both Liverpool and Manchester have contributed to this huge boost in investment.

Office Space

The top investment in the north-west region’s commercial property sector was office space. This accounted for 41% of all transactions in the first quarter of 2018. The retail sector continues to fall slightly behind, which is something mirrored across the whole of the UK as customer attention continues to shift online.

While retail is likely to continue to be more subdued, there seems no stopping the rest of the commercial sector in Liverpool and Manchester, as well as surrounding areas.

Build-to-rent Investment

We’ve also seen a significant increase in build-to-rent investment deals in the north-west. This was again boosted by a major deal in Liverpool. This was to create 383 build-to-rent unites and the development has been financed by forward-funding by Invesco and Manchester arena.

Both Liverpool and Manchester have enjoyed major advances in their build-to-rent market over the last year or so, and industry experts expect this to continue as an investment trend.

Comparatively strong

Overall, the north-west continues to perform strongly and this is shown clearly when figures are compared with the rest of the country’s data. A broad rage of investors, from the UK and overseas, are continuing to show real interest in investing in the region.

As we head towards Brexit and the uncertainty it brings, more investors are turning away from London and looking around at other viable investment hotspots in the UK. Liverpool and Manchester are continually surprising the market with excellent figures and its’ likely that this strong start to the year will continue throughout the rest of 2018.

Buy-To-Let Market Buoyed By Low Rates And More

property investment areas

The latest facts and figures on buy-to-let properties show that things are once again on the up for this ever-popular investment option. With recent changes to mortgage legislation and remarkably low rates, many experts are speculating that this is a great time to get into the buy-to-let market.

So, with this in mind, let’s take a closer look at a few of the reasons why buy-to-let looks set to boom yet again.

Lower Fixed Rate Buy-to-Let Mortgages

Buy-To-Let Market Buoyed By Low Rates And More Aspen Woolf

Photo Credit: Simon Cunningham via Flickr

There has never been a better opportunity to get into the market with a fixed low rate mortgage. Lower rates have recently become more tempting for new investors, with five-year fixed rate buy-to-let mortgages available for as low as 3.29%. Two-year fixed rates are even lower; the best offers at present starting at just 2.09%.

It is worth looking out for the best available deals on a fixed rate buy-to-let mortgage as the number of offers for this type of mortgage has shot up rapidly in the past couple of years. According to Moneyfacts, there are now 83 different fixed-rate deals available for buy-to-let, compared to only 5 that were available just two years ago.

Higher Returns on Property Investment

Buy-To-Let Market Buoyed By Low Rates And More Aspen Woolf

Photo Credit: Jeff Djevdet via Flickr

Another good reason to invest is that the average rented property is now producing almost as much annual return as the average salary in the UK. The average buy-to-let property is returning £24,221 in capital gains and annual income, while the average British salary is around £25,000.

Return on investment in UK property is still on the rise too. Last year the total value of owned property in the UK stood at £990.7 billion, with an estimated total of annual return on property investments standing at £111.5 billion. This is an increase of 12.2% from 2000 and it means that the value of the property retail sector is now equal to almost half the value of the UK stock market.

In the longer term, there has been no better investment than property. Every £1,000 invested in 1996 was worth £14,897 by the end of 2014. This means that some landlords have seen a return of around 1400% in less than 20 years.

More Lenient Mortgage Lenders

Buy-To-Let Market Buoyed By Low Rates And More Aspen Woolf

Photo Credit: Diana Parkhouse via Flickr

The Financial Ombudsman found HSBC guilty of discrimination in a recent case after the bank turned down a mortgage application solely because of the applicant’s age.

The bank refused the application because one partner would have reached the age of 65 before the end of the mortgage term, but the FOS ruled that their decision relied upon untested assumptions, stereotypes and generalizations.

Lenders are therefore more willing now to accept mortgage applicants at any reasonable age. The maximum mortgage term is 35 years, but that length of term is still only likely to be offered to younger applicants.

Greater Demand Means Higher Rents

Buy-To-Let Market Buoyed By Low Rates And More Aspen Woolf

Photo Credit: Emma Brabrook via Flickr

There have always been good reasons to become a landlord, but there are even more now due to the significant growth in demand for properties to rent across the UK. Over the past year, 150,000 more households entered the private rental sector, increasing the market by £5.8 billion.

At present there are around 4.8 million properties being rented out, and it has been estimated that by 2020 the number of households living in rented accommodation will be 5.5 million.

As the demand for rented property has increased over the past 5 years, rents have also gone up rapidly. There was a rise of 3.7% between May 2014 and April 2015 with an overall increase of 15% since May 2010.

With demand and yields in the private rental sector being driven up by current economic conditions and banks becoming more lenient, it is easy to see why so many are choosing to enter into the property market with a low fixed rate buy-to-let mortgage.

If you liked this blog post then perhaps you would like to read our guide on how to buy a home?

Feature image credit: Flickr