While the likes of London may attract investors due to the strong economy and allure of being the capital city, many buy-to-let investors tend to look to other areas of the UK. This is due to the huge average property price and soaring rental prices deterring potential tenants. According to the HM Land Registry UK House Price Index, the average property price in the City of London is £901,625 (as of August 2023). While these figures may be skewed by the ultra-prime property prices in Chelsea and Kensington, they are still significantly higher than the average UK property price of £290,353.
Let’s compare that to more northern cities, such as Liverpool.
While Liverpool may not have the same economic level as the English capital, it still boasts a considerable job market at its own rate. As such, graduate retention levels are high, with more young professionals choosing Liverpool for work.
Not only are young professionals staying in Liverpool for job opportunities, but they are also benefitting from competitive rental prices. The average rent in Liverpool is £1,082 pcm, according to the Home.co.uk Liverpool Market Rent Summary. In comparison, the average rent in the London region is £2,127 pcm, according to the HomeLet Rental Index.
Also, the Liverpool property prices are considerably cheaper than in London. Per HM Land Registry, the average property price in Liverpool is £177,076. This makes Liverpool properties around 134% more affordable than London.
According to Zoopla, the average gross rental yield in Liverpool is 7.43%, while the London region has the lowest average in the country at 4.92%.
In addition, the North West is predicted to enjoy 9.2% returns in the buy-to-let market over 2024 (according to Savills), making it potentially one of the most lucrative places to buy property to rent out in the UK over the next 12 months.
So, if you’re looking at buying an investment property as part of your property investment strategy, it could prove to be a more savvy investment thanks to good-value prices and significant tenant demand.
Discover More: Feel free to browse some of our other helpful guides and insights, whether you want to learn how to generate a passive income or about the highest-yielding UK regions.
