Finding the best places to invest in property in the UK is crucial for maximizing returns due to regional variations in market trends. IP Global aids investors by using their expertise to identify promising areas, aligning investments with opportunities for high returns and mitigating risks. This strategic support is essential for optimizing investment outcomes.
What makes a location an optimal place for property investment?
Choosing the best places to invest in property is just as crucial as selecting the property itself when it comes to real estate investment. The location determines not only the potential return on investment through appreciation but also affects the property's demand, rental rates, and overall desirability.
Key factors that make a city or town the best place to invest in property include:
- Economic Growth: A strong and expanding local economy with job growth and low unemployment rates attracts more residents, boosting demand for housing.
- Infrastructure Regeneration: Investment in transportation, utilities, and public services that improves the quality of life and accessibility can increase property values.
- Population Trends: Areas experiencing population growth are likely to see increased demand for housing, both rental and owned.
- Real Estate Market Trends: Stable or increasing property values and rental yields indicate a healthy real estate market.
- Schools and Educational Institutions: Locations with access to quality education are highly desirable for families, which supports sustained demand.
- Proximity to Amenities: Easy access to shopping, dining, entertainment, and recreational facilities makes a location more appealing to potential residents.
- Public Transportation: Efficient public transport options can significantly enhance property appeal, particularly in urban areas.
The Best Places to Invest in Property in the UK
Manchester, Birmingham, Leeds, Newcastle, Liverpool, and Sheffield stand out as some of the best places to invest in property in the UK, each with unique attributes that contribute significantly to their economic and cultural profiles. These cities are vital economic centres with diverse industries. The financial data supporting this analysis comes from the Office for National Statistics (ONS), as well as Oxford Economics and Zoopla.
Manchester
Manchester, is recognized as the powerhouse of the North of England, and boasts a thriving arts and cultural scene alongside one of the UK's largest student populations, totalling over 100,000 students. This vibrant atmosphere is further energized by the city's deep-rooted football culture, with two major clubs attracting over 40,000 fans each week. The property market in Manchester is particularly appealing for investors, featuring an average house price of GBP245,000, a monthly rent of GBP1,194 — which has seen a 12.3% increase from the previous year — and an impressive average rental yield of 6.53% according to Zoopla. These factors create a robust environment for property investments.
Birmingham
Birmingham, the UK's second-largest city, has an economy worth GBP38 billion, the most robust outside London, making it a prime location for property investment. The city is also one of country's youngest, with five universities and over 80,000 students, contributing to a strong rental market. Current real estate statistics are promising for investors looking for the best places to buy property in the UK: the average house price is GBP231,000, the average monthly rent is GBP985 — a 14.1% increase from the previous year — and the average rental yield stands at 6.1%. These numbers highlight Birmingham’s growing demand for rental properties and its potential for solid investment returns. This makes Birmingham one of the best places to buy property in the UK.
Leeds
Leeds stands out as one of the best places to invest in the UK, recognized as the ‘best city to live and work in the North of England’ in 2021. The city's economic strength is improved by the city being the second-largest banking and finance sector in the UK, creating a multitude of job opportunities and attracting high-income professionals. This influx boosts demand for quality housing, benefiting property investors. Additionally, the Leeds South Bank regeneration project is set to expand the city’s size significantly, with plans to create 35,000 jobs and over 8,000 new homes, further enhancing the city's appeal as an investment hotspot. The property market in Leeds presents attractive figures for investors: the average house price is GBP235,000, the average monthly rent is GBP1,080 — an 8% increase from the previous year’s GBP1,000 — and the average rental yield is 6.67%. These statistics reflect a growing and vibrant market with substantial potential for investment returns.
Newcastle
Newcastle is emerging as one of the best locations for property investment in the UK, particularly due to the Teesside Freeport, the largest in the UK. Its proximity to Newcastle enhances the city's appeal as a business hub, attracting companies and boosting employment. Additionally, Newcastle's tech and digital economy has expanded by over 51% since 2013, bringing a significant influx of professionals and increasing housing demand. These developments are reflected in the local property market, with an average house price of GBP193,000, an average monthly rent of GBP979 — an increase of 5% from the previous year — and an attractive average rental yield of 7.45%. This combination of factors makes Newcastle an appealing option for property investors looking for growth potential and strong returns.
Liverpool
Liverpool is a compelling choice for the best places to buy property in the UK, driven by its extensive urban regeneration and vibrant cultural scene. The city has seen significant redevelopment projects like the Lime Street regeneration, which includes a new 412-bedroom student block, 30,000 square feet of commercial space, and a 101-bedroom hotel. This ongoing revitalization enhances the city's appeal and functionality. Furthermore, Liverpool is a leading UK student destination with three central universities and over 70,000 students, creating a steady demand for rental properties. The city also benefits from the international appeal of Liverpool and Everton FC, Premier League teams whose games attract tens of thousands of spectators and further spotlight the city globally. These factors combined with an average house price of GBP180,000, an average monthly rent of GBP794 — an 8.7% increase from the previous year — and a robust average rental yield of 7.44%, position Liverpool as a dynamic market with strong potential for property investors.
Sheffield
Sheffield is a strong choice for the best places to buy property in the UK, boasting a growth rate of 11% since 2000, and being the country's fourth-largest city with a population of 571,630. The job market in Sheffield is supported by major companies like Siemens, HSBC, Boeing, and IBM, which enhances employment opportunities and increases demand for housing. The average house price in Sheffield is GBP216,000, and the rental market is also performing well, with an average monthly rent of GBP829, up 9.8% from the previous year. With an average rental yield of 6.38%, Sheffield offers solid prospects for investors looking for dependable returns in a city with a growing economy and a robust job market.
Choosing the Best Property Investment Strategy
Understanding the best investment strategy is essential before purchasing a buy-to-let property. Student property investment, involving renting to students through purpose-built accommodations or HMOs, capitalizes on steady demand in university towns, making it one of the best places to buy property in the UK. Residential investment is another strong option, where an investor buys a house or flat to rent to tenants, known for its potential for long-term growth and consistent rental yields.
Ultimately, the choice of investment strategy should align with the individual’s goals and market conditions in the best places to invest in property in the UK.
Where is the best place to buy property in the UK?
Determining the best place to buy property in the UK largely depends on your investment goals and budget. For those aiming for high rental returns, cities like Manchester and Newcastle stand out as prime options. These cities offer vibrant student populations and a continuous influx of young professionals, which keep demand for rental properties high. As a result, these locations are often cited among the best places to invest in property in the UK, specifically for those interested in achieving strong and steady rental income.
On the other hand, if the goal is long-term capital growth, Liverpool and Manchester are noteworthy choices. Both cities have been undergoing significant regeneration, leading to an increase in property values over time. Liverpool, in particular, has seen extensive redevelopment which has transformed the cityscape and boosted its appeal as a residential area. Manchester continues to attract a high level of investment in both commercial and residential development, solidifying its reputation as one of the best property investments in the UK. Each city offers unique opportunities, and the choice should be guided by thorough research into the specific market dynamics and potential future developments in each location.
At IP Global, we have a track record of investing over USD3 billion in 18 countries, which has given us the expertise to make investing with us the smoothest end-to-end experience - something that can be a daunting adventure. Go to our contact us page to find out more about how we can help.
