Buy to let property investment opportunities in Northern UK cities like Manchester and Liverpool might well be the next big thing for the UK property investment market.
Investment Properties for Sale in the North vs. London
When people speak of investment properties for sale in the UK or investing in real estate here in the UK, most people think or look to London. Either off-plan property in London and/or new homes in London. Many foreign investors in particular consider these types of investment properties in prime London to be trophy assets, providing only moderate returns in the region of 4%, but significant capital appreciation opportunities. As a result the interest around these properties is understandable, but the high level of demand, particularly from overseas has inflated London prices well beyond the reach of many investors, especially domestic investors and homebuyers. The North of England, meanwhile, is often overlooked and is a market which is far from saturated.
This situation is now beginning to change, as there has been a significant increase in the number of UK based investors looking beyond the capital city and instead setting their sights on the North West of the country. This trend is also becoming more prevalent amongst foreign investors, with significant increases in the number of buyers from overseas who when considering investing in property abroad are beginning to look beyond London, particularly in Northern UK cities such as Manchester and Liverpool. The average property price in the North of England is less than the national average of £200,000, and not only can investors regularly achieve strong rental returns (more than double than is achievable in London) in the region of 6% – 10% in these cities, but there is considerable capital growth potential given the increasing population, the increasing demand for new homes and the rapidly growing economies of these key cities in the North of England.
Buy To Let Property Investment Opportunities in the North West
The Northern Powerhouse has a lot to offer investors, with key cities rife with opportunity, attracting both UK and international property developers; and with more and more new developments popping up, demand for rental properties in cities in the North West remains high and comes from a number of different markets. The demand for high quality accommodation in prime city centre locations is increasing from both today’s discerning students and young working professionals, whilst small and growing families are looking to settle into high quality homes, which more often than not will be on a long term lease providing investors with both security and a consistent revenue stream.
Despite properties in the North of England requiring considerably less outlay and financial commitment in comparison to new homes in London, investors can expect to achieve much higher returns on investment. Although these properties are currently very competitively priced, experts are projecting for property prices to increase over the next few years once the market begins to settle following the recent decision to leave the EU. There is perhaps an even greater potential for owners of properties in the North to benefit from capital appreciation than there is for investors in off-plan property in London. This is a view shared by real estate developers who are continuing to plough ahead with their plans in these key Northern cities.
Brexit’s Impact on Investment Properties for Sale in the UK
The result of the recent referendum on leaving the EU will continue to cause some disturbance in both the property market and in the value of the pound. In the short term property prices will fall given the reduction in demand due to uncertainty, but once the initial shock of the result has passed it is the general consensus that the UK property market will show its resilience and make a full recovery and will only continue to grow from there. The obvious result of this will be significant capital gains for those who invest today exploiting current opportunities in the market.
For overseas investors the weakened pound creates an even greater opportunity to get more for your money. In particular wealthy investors from China are fuelling what we expect is the beginning of a property boom in the North West, having been driven away from London by high prices and the recent increases in stamp duty.
If you’re concerned about how the referendum might affect you, our recent blog post, ‘How Does Brexit Affect Investment Properties for Sale in the UK’ provides further insight. Alternatively, view our range of investment properties for sale in the UK now and contact us to find out more.