The buy to let market is booming. After such a surprisingly impressive performance throughout the pandemic, the property market continues to go from strength to strength as we continue into 2021.
The demand from tenants surged by an incredible 10% in Q1 2021, whilst buyer demand hit twice the normal levels in March and the number of overseas landlords with UK properties hit a 5-year high. These impressive feats only highlight the prosperity of the UK buy to let market, so here at yieldit we thought we’d take a look at some of the UK’s buy to let hotspots!
Here are just a few of the best places for buy to let investment in 2021:
Manchester
Manchester is one of the most renowned and popular cities in the UK. The city is home to a young and growing population as people continue to move away from the capital for a more affordable lifestyle. The city is considered to be the economic hub of the North and one of the UK’s top rental hotspots thanks to its popularity amongst tenants.
In the last 5 years alone, house prices in Manchester have increased by over 23%, more than 10% higher than the overall increase in England, and JLL expect this impressive growth to maintain its upward trajectory. In their Regional Forecast for Northern England, JLL predicted that house prices in Manchester are set to continue to increase by over 17% in the period between 2020-2024, 2.3% higher than that of the UK average.
These ever-increasing house prices have resulted in an unwavering demand for rental property in the city, something reflected in JLL’s rental growth forecast. Once again in the period between 2020-2024, rental growth is expected to completely surpass that of the UK national average and increase by 16.5%. Compared to the UK’s 12% growth, it is clear to see the massive investment potential this Northern powerhouse has when it comes to buy to let.
Liverpool
We’re staying in the North West for our next entry and taking a look at the waterfront city of Liverpool. Home to The Beatles, two top football teams and a prosperous property market, the city has seen its reputation soar in the last decade or so thanks to an abundance of regeneration – resulting in the city transforming into an extremely sought after location when it comes to both tenants and investors.
House prices in the city have increased by over 13% in the last 5 years, which, like Manchester, is above England’s average increase in the same time period. In their aforementioned Regional Forecast, JLL predict that prices in the period between 2020-2024 are set to equal the growth over the last 5 years and increase by just over 13%.
Rents in the area are also expected to increase in a similarly impressive way. During the aforementioned period, rents in Liverpool are expected to increase by almost 15%, once again surpassing the UK average. More and more people choosing to move to the once Capital of Culture thanks to the brilliant lifestyle and affordable living, resulting in an extremely strong buy to let market.
North East
So far, we’ve only really focused on cities, but looking on a larger scale, the North East region on the whole has steadily flew under the radar as one of the country’s best locations for buy to let investment. Comprising of towns and cities such as Newcastle upon Tyne, Sunderland, Middlesbrough, the City of Durham, Gateshead, Darlington, Stockton-on-Tees and Hartlepool, the North East is home to over 2.6 million and looks set for some impressive growth in years to come.
House prices in the last 10 years have increased by over 17%, but the last year has seen a massive boost for the region’s property market. According to Rightmove’s house price index, the North East saw the highest average change in asking prices, with an increase of 10.6% throughout 2020. The future is looking equally bright for the region, with the North East currently in the midst of a 10-year Strategic Economic Plan, aiming to massively improve the North East economy by 2024. This economic development will only enhance the property market growth in the next few years. Savills have forecast an impressive 20.5% growth throughout the 5 years to 2025.
The region is home to numerous investment hotspots. Sunderland is home to a growing population and a booming economy that has resulted in a prosperous property market. House prices in Sunderland have increased by almost 22% in the last decade according to Zoopla; with the property portal also placing Sunderland in their top 10 UK property investor hotspots in 2020. Newcastle upon Tyne has also seen some impressive growth in recent times, with house prices in the region increasing by over 33% in the last decade. The rental market has performed just as well, with average yields across Newcastle increasing by 13% in the last 5 years. An influx of investment and regeneration has seen Middlesbrough’s buy-to-let market boom with Zoopla naming the city as its number 1 investor hotspot in the UK.
This plethora of excellent investment locations and further growth in the coming years has solidified the North East’s status as one of the UK’s finest buy to let hotspots.
What next?
With the UK property market in great shape at the moment and showing no signs of slowing down, 2021 is the perfect time to capitalise on one of, if not, the leading investment class in the country. At yieldit we specialise in the buying and selling of tenanted, income generating buy to let property. Why not take a look through our range of available properties here and get in touch with us today!
