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Best buy-to-let areas UK

In the midst of all of the economic uncertainty over the last few years, one investment class has not only weathered the storm but actually reached new levels throughout the pandemic – UK property.

As markets around the world stalled, staggered and even plummeted, UK property – in particular buy to let property – saw its reputation soar as the market performed better than anyone could have ever anticipated.

House prices and rents soared to new heights throughout the year. In the three months to the end of November 2021, house prices increased by 3.4% and were up an impressive 8.2% from the year prior. This three-month increase is the largest in over 15 years according to Halifax, as the market ended an already impressive year in an extremely strong way.

The rental market also faired extremely well through the year. Strong tenant demand across the country, in particular in Northern areas, resulted in a huge increase in average rents. UK average rents actually reached a record high when they broke the £1,000 per month barrier for the first time in July 2021. By the end of November 2021, the average UK rent stood at £1,058 pcm as the market somewhat stabilised after such an immense period of growth

With house prices and rents expected to increase year-on-year for the next five years and beyond, 2022 is the perfect year to expand your property portfolio. With this in mind, we’ve taken a look at the best buy-to-let areas UK.

27.7%

House prices are set to increase by 27.7% in the period between 2022 and 2026.

2.5%

House prices are set to increase by 2.5% in 2022.

2.5%

Rental values are also set to increase by 2.5% in 2022.

£1,000

UK average rents actually reached a record high when they broke the £1,000 per month barrier for the first time in July 2021.

Manchester

Manchester is one of the most renowned cities, not just in the UK, but in the entire world. Home to Manchester United, The Smiths and Coronation Street to name a few, Manchester is one of the UK’s leading cities when it comes to its economy and in turn, the property market in the region.

The future is bright for the unofficial capital of the North, with JLL forecasting impressive growth in terms of both house prices and rental values over the next five years. In their aforementioned UK Residential Forecasts 2022 – 2026, JLL forecast that house prices are set to increase by 6% in 2022, followed by sustained growth over the next 5 years culminating in an impressive 25.8% growth. Rental values are also set to grow in the same time period, with a 4% increase in 2022 followed by a 15.9% cumulative growth over the stated time period, making it one of the best areas for buy to let in the UK.

Liverpool

Located on the River Mersey in the North West of England, Liverpool is famous around the world as a shipping port and former Capital of Culture. The city benefits from a young and extremely exciting population that is consistently growing thanks to the plethora of opportunities that the waterside city has to offer.

The market looks set to continue it’s upward trajectory over the next few years as Liverpool solidifies its status as one of the best areas for buy to let in the UK. In their Residential Forecast report, JLL forecast that in 2022 alone, house prices in the city are set to increase by 5%, before continuing this trend for the coming years to produce a cumulative increase of 21% in the period between 2022-2026. Rental values are also set to increase in the same period, starting with a 3% increase throughout 2022 that will pave the way for a cumulative increase of 13.7%.

Sheffield

Located in the heart of South Yorkshire, Sheffield is one of the most up-and coming regions in the UK thanks to the extremely desirable lifestyle in the city. Residents can enjoy an enviable mix of stunning natural landscapes and outdoor activities, paired with a compact city centre featuring amenities like shopping malls, markets, bars, restaurants and more.

According to Zoopla, house prices in Sheffield increased by an impressive 7.9% in the 12 months leading to October last year, bettering the likes of Birmingham, Bristol, Glasgow and London to name a few. The rental market in Sheffield is equally as buoyant, no doubt spurred on by the high number of students who decide to remain in the city following the completion of their studies. According to Knight Frank’s Student Accommodation survey, 40% of respondents indicated that they plan to remain in the city post-graduation, putting further pressure on the already in-demand rental market, increasing rental returns in the process.

Bradford

Bradford is a city that probably doesn’t spring to mind when thinking of leading UK cities for property investment, but the West Yorkshire city is currently on an extremely impressive trajectory that could transform itself into one of the most accessible yet prosperous property markets in the UK.

The rental market in Bradford has no doubt been boosted by the city’s young population. According to data from Bradford City Council, nearly 70% of the district’s population are aged under 50 – the prime age for those looking for rental properties – and more than 30% aged under 20.

Bradford benefits from a perfect mix of a young and growing population, lower-than-average house prices and higher-than-average house price growth that offers the potential for impressive rental yields and strong capital appreciation for those who invest in property in the city.

Download the full guide here!