1. Demand
Despite the Stamp Duty holiday winding to a close in September, buyer demand is still 80% higher than average levels witnessed between 2017 and 2019, with the number of prospective buyers per property doubling compared to pre-pandemic levels.
The “Race for Space” continues to drive market activity, with many taking the plunge and migrating to smaller towns and cities across the country to seek a better run for their money and higher standard of living. As a result, statistics show private rentals outside of London are rising at their fastest rate in 13 years with an average of 5% growth.
Newly published figures indicate the cities which are experiencing the largest rises in rents are those predominantly located in the North of England. When population size was discounted, Manchester saw the greatest demand for new-build homes with over 22,000 annual searches, and following closely behind, Birmingham acquired 15,840 searches.
The appeal of Manchester has also been documented on a global scale. The city was recently recognised as the third best city in the world, proudly positioned above the likes of London, New York and Tokyo – celebrated for its nightlife, creativity and community spirit.
Smart investors know to seek out the areas which are seeing the strongest growth in demand and desirability as this can affect future gains and rental yields – a key component to the success of a buy to let property investment.
2. Maximal Profitability
Our attention is fixed on the North West of England, where prime regional cites including Manchester and Liverpool are offering the most attractive property investment market conditions, boasting well below the average in property prices and record highs in house price growth.
At a city level, Liverpool (+9.4%) Manchester (+8.1%) and Sheffield (+7.6%) took the top 3 spots. By comparison, London achieved just 2.5% growth during the same period, making it the city with the lowest levels of growth in the UK.
Over the last year, London prices fell while regional cities soared, particularly in the North West region which grew 18.6% – driving the largest rise in UK property prices in 17 years. This reaffirms where property investors and landlords should be looking to ensure maximal profitability and reap the best returns.
Looking forward, Savills forecast the Northwest of England will finish 2021 with a 10.5% rise in house prices – suggesting the pace of the strongest performing region is showing no signs of slowing down.
3. Regeneration
Areas benefiting from key investment and regeneration plans significantly impact their appeal, driving employment and population growth – both of which positively impact house prices and lead to a rise in buy to let property investment opportunities.
Manchester is home to some of the UK’s largest regeneration schemes, transforming the city into a highly attractive and modern place to live and work. Completed projects like the £1.5 billion Spinningfields scheme has generated a “Canary Wharf of the North”, with the likes of Deloitte, HSBC and PWC operating here. Additionally, NOMA is an ongoing project which has become the largest development in the North West region with a mission to develop 20 acres of new and refurbished offices, retail and leisure spaces.
A major transport initiative is the highly anticipated HS2 rail which is expected to slash journey times between key Northern cities and London. The improvement in accessibility will drive greater connectivity in cities such as Manchester, Liverpool, and Birmingham. From an investment perspective, it’s hugely worthwhile investing in areas close to the promised rail, as investors can expect substantial price appreciation over the coming years as HS2 comes to fruition.
Conclusion
Overall, investors need to centre their strategy around location to achieve high yielding, in demand properties with the strongest capital appreciation prospects.
Over this past year, the Northwest of England has continually outperformed all other UK regions and explains why we have a diverse portfolio of property investment opportunities and off plan developments located in this region.
If you’d like to have a chat about our buy to let property opportunities over a coffee, we’d love to welcome you to our London office. Contact us today on +44 (0)203 819 7366 to set up a meeting.
