Why the North-West comes out top for UK property investments

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When you think of the UK property market, you might be inclined to automatically look towards London. Whilst London remains a big factor in the UK economy, reports of uncertainty in the face of the Brexit outcome continue to turn many potential investors away from UK property investment. Look a little deeper, however, and you’ll see that a number of UK cities are in fact thriving when it comes to property.

The north-west region, home to cities like Liverpool and Manchester, has quickly grown into one of the UK’s most popular economic powerhouses. Both these key cities have come a long way in the last few decades, with extensive regeneration projects improving each city and bringing a lot of attention from investors around the globe.

So what makes property investment so promising in this region?

Both Liverpool and Manchester are known for their affordability compared to London. Those purchasing a house in London can expect an average of £484,173. Look up north, however, and this average falls to £130,677 in Liverpool and £173,381 in Manchester. Figures like these make it clear why so many Londoners are choosing to move up North in the hope of eventually buying the property themselves. Record numbers of Londoners have been reportedly leaving the capital in 2017 and moving to Manchester, with a large proportion of these being young people. With younger generations facing great difficulty in buying their first home, the north-west provides a welcome solution.

Of course, not everyone who decides to live in the north-west can afford to buy property right away. Many young people moving to cities like Liverpool and Manchester are choosing to save money while renting in the city. This, combined with the general appeal of north-west cities, has led to a surge in demand across the region. Manchester and Liverpool have some of the fastest growing city centre’s, leading to huge increases in rental price growth as high as 5.76% in Manchester.

What are the North-Wests rental yields?

These growing rental costs paired with the overall affordability of property in the north-west has generated some of the most impressive rental yields in the UK. Liverpool boasts average rental yields of 5.05%, and Manchester 5.55%, both of which massively exceed the London average yield of 3.05%. Many properties throughout the key cities of the region offer even more attractive prospects, with some postcodes in Liverpool boasting yields as high as 11.79%. These impressive yields mean that those who choose to invest in north-west property can benefit from a large return on investment from rental payments, along with a high chance of increased value when they decide to resell further down the line.

Whilst cities like Liverpool and Manchester are seeing an influx of young professional type tenants, the student population of the north-west is another reason why property investment in the region is so popular. Manchester, for instance, boasts the largest single-site university in the UK, with a student population of over 99,000. With a lively nightlife, endless cultural attractions and so much to do and see, the north-west continues to bring in more and more students each year. It is for this reason that student property is in high demand, and offers one of the most lucrative types of venture for those investing in property in these key cities. Student property is often the most popular type of investment for first-time investors, usually having lower prices than other investment properties and high yields.

More recently, luxury student accommodation has become more popular, which offers a more high-end university stay with amenities like super fast internet, stylish and modern decor, and the right combination of private and communal spaces. With Liverpool welcoming a large number of international students, particularly those from China, the city is seeing a lot of demand from students that are willing to spend more on their rental costs.

All in all, there are so many reasons to consider investing in north-west property. Even with the uncertainty surrounding Brexit, the region is expected to remain strong, with house price growth in the region predicted to exceed any other area in the UK over a five-year period.

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About Editorial Team 64 Articles
Watch My Wallet has everything you need to know about money, written by real people who’ve been there. Inspired by the philosophy of Early Retirement Extreme (ERE), our goal is to make informed decisions about our finances in order to achieve financial independence.

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