We look at the 10 best places to invest in property in the UK and why these are the top options.
Summary
The 10 best places to invest in property in the UK are all transforming and growing.
The average rental yield is between 2.9% and 8.2%, depending on the location.
Local economic growth, infrastructure, amenities, and rental demand all play a role in making a location desirable.
A mortgage broker can help you to secure the best rates and maximise your returns.
What makes a location a good place to invest in property?
Investing in property is not just about finding a house; it’s also about “location, location, location.”
Choosing the right location is the key to unlocking profitable opportunities and ensuring a robust return on your investment.
There are several crucial factors that should guide your decision:
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Economic growth and job opportunities: A thriving local economy with diverse job opportunities attracts more residents, leading to increased demand for rental properties.
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Infrastructure development and connectivity: Strong infrastructure, including transport links and amenities, enhances an area’s appeal.
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Rental demand and potential for capital growth: Locations with a high rental demand often offer better yields and long-term capital growth potential.
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Local amenities, schools, and recreational spaces: Access to high-quality amenities, schools, and recreational spaces add value to a location. Families, in particular, seek areas with good schools and nearby parks.
According to law firm Shoosmiths, several legal changes, such as the Renters Reform Bill, may impact property investors in 2024 and beyond.
When considering property investment, it is advisable to stay informed about the potential implications of any new legislation.
Where is the best place to invest in property in the UK?
The potential for profitable investments in the UK property market isn’t limited to a few areas.
From vibrant cityscapes to up-and-coming regional gems, many places offer enticing property investment opportunities.
The key is to explore diverse locations and align your goals with each area’s unique prospects.
While the best places to invest in property may seem unconventional, they’re chosen based on research and the return on investment (ROI). Lower property costs in these locations also facilitate quicker returns.
Based on current property investment figures from online database Numbeo and Hometrack, here are the best places to invest in property in the UK:
Birmingham
Birmingham’s impressive transformation into a business and cultural hub has driven demand for property.
The city’s ongoing infrastructure developments have positioned it as a hotspot for property investment.
Birmingham’s Eastside and Southside are undergoing massive regeneration, as are areas such as Digbeth, which is turning into a trendy district.
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Average property price: £207,100
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Average rent: £1,275 per month
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Average rental yield: 5.5%
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Price movement (last year): Prices have risen by 2.7%.
Manchester
Manchester has experienced substantial growth in recent years. The city’s vibrant cultural scene and booming business environment attract residents and investors alike.
Areas like Ancoats and New Islington are undergoing urban regeneration, converting industrial spaces into modern residential and commercial units.
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Average property price: £220,000
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Average rent: £1,300 per month
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Average rental yield: 6.25%
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Price movement (last year): Prices have increased by 2.3%.
Glasgow
Glasgow is emerging as a hidden gem for investing in property, as its economic vibrancy has ensured a consistent demand for rental properties.
Notable developments in the West End, such as the University of Glasgow expansion, have contributed to the area’s desirability, attracting students and professionals alike
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Average property price: £142,800
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Average rent: £1,200 per month
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Average rental yield: 6.56%
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Price movement (last year): Prices have risen by 0.3%.
Liverpool
Liverpool’s rich cultural heritage and ongoing economic revival make it an attractive prospect for property investors.
Its affordability, coupled with developments in areas such as the Baltic Triangle and Knowledge Quarter, enhances Liverpool’s appeal, creating modern spaces for residents and businesses.
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Average property price: £155,700
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Average rent: £965 per month
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Average rental yield: 6.7%
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Price movement (last year): Prices have increased by 1.8%.
Leeds
As a diverse economic hub, Leeds attracts a steady influx of residents and businesses.
Developments, including the South Bank regeneration project, are transforming the waterfront area, highlighting Leeds’ commitment to modernisation and urban living.
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Average property price: £210,000
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Average rent: £1,120 per month
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Average rental yield: 4.8%
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Price movement (last year): Prices have risen by 2.3%.
Newcastle
Newcastle’s affordability and lively cultural scene make it an attractive location for property investors.
Developments like the Helix project contribute to Newcastle’s modernisation, offering new opportunities for those looking for property to invest in.
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Average property price: £150,000
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Average rent: £1,140 per month
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Average rental yield: 5.7%
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Price movement (last year): Prices have risen by 2.1%.
Nottingham
Nottingham’s diverse economic landscape, affordability and steady job market mean a positive outlook for investors.
Developments like the Nottingham Southside regeneration project aim to transform the area by creating modern living spaces and commercial opportunities.
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Average property price: £202,500
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Average rent: £1,030 per month
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Average rental yield: 2.9%
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Price movement (last year): Prices have increased by 2.9%.
Bradford
Bradford is gaining attention from property investors due to its ongoing regeneration efforts, such as transforming areas like City Park and the Broadway shopping district.
Bradford’s affordable property prices, combined with these improvements, make it one of the best places to invest in property.
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Average property price: £186,000
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Average rent: £670 per month
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Average rental yield: 4.7%
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Price movement (last year): Prices have dropped by 2%.
Hull
With its waterfront development and stable economy, Hull is emerging as another hidden gem for property investors.
Specific developments, such as those along the Humber Estuary, are examples of Hull’s commitment to modernisation, making it an attractive prospect.
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Average property price: £143,000
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Average rent: £650 per month
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Average rental yield: 4%
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Price movement (last year): Prices have decreased by 3%.
Leicester
Leicester’s affordability and strong job market make it another attractive choice for investors.
Developments like the Leicester Waterside project are contributing to the city’s transformation, offering modern living spaces and commercial opportunities.
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Average property price: £227,600
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Average rent: £1,075 per month
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Average rental yield: 8.2%
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Price movement (last year): Prices have risen by 1.5%.
Where are the worst places to invest in property?
While many locations offer lucrative opportunities for investing in property, some places may not be financially beneficial.
Here are five areas Track Capital suggests you approach with caution:
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Southend-on-Sea: Limited job market and slow economic growth.
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Blackpool: High crime rates and limited economic diversification.
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Wolverhampton: Challenges in economic development and limited diversification.
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Sunderland: Economic struggles impacting property market performance.
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Stoke-on-Trent: Slow population growth and limited economic opportunities.
Seek expert financial advice
Navigating the diverse landscape of property investment in the UK requires careful consideration.
The importance of choosing the right location for optimal returns and factors such as economic growth, infrastructure, and rental demand play crucial roles when investing in property.
You can embark on a successful journey by focusing on the best places to invest in property in the UK and understanding the key factors that influence investment decisions.
As mortgage rates have climbed significantly over the past two years, a mortgage broker can offer guidance and help you secure the best rates.
Let Unbiased match you with an expert mortgage broker who will help you find the best property investment options with the best returns.
