Look North for Higher Property Investment Yields

Written by Posted On Sunday, 21 January 2018 19:04

As a tough London property market makes for steady but largely unimpressive rental returns, property investors may want to look north for stronger yields. But we’re not talking Islington, or even Watford, but further afield to north west England.

Two recent research reports have identified the region as an up-and-coming one for property investors. So perhaps it’s worth taking a closer look?

“North west England is a couple of hundred miles from the centre of London, but if you’re on the look out for a better rate of return on your property investments, it night be a place worth getting a bit more familiar with,” said Nationwide skip hire, Proskips. “Investing in BTL properties in a new region can be a bit of a risk, but if you do your research thoroughly, it could be one that’s worth taking.”


Good Rental Yield Potential

Recent research from high-yield property investment specialists, Mistoria, pinpoint the region as a good property investment opportunity. Property prices have been rising in and around Manchester. And, the level of interest from BTL investors has also been on the rise.

But, right now, rental demand is high and potential yields are solid. Mistoria details average yields of 7.08% in Salford, 5.96% in Leeds and 5.79% in Manchester.

Manchester’s rental market is an interesting option as it supports a good mix of tenant types. It’s no longer just students and young professionals who are looking for rental properties.

As rising house prices make it more difficult for people to afford to buy a home and with more people moving further away from ‘home’ to find the best prices, demand for rental properties is from a broader group of people than ever.

“Even if someone’s planning to buy a home, they often rent first to get a feel for an area and with rail links to Manchester and the surrounding areas set to improve, this is something that’s, in part, fuelling rental demand there,” said You Choose Windows.


Capital Growth Looks Good, Too!

It’s not just rental investor experts who are upbeat on Manchester. Analysis from global property management specialists Savills, suggests average house price growth of 18.1% between now and 2022.

Their research points to an affordable housing stock, strong economic potential and a healthy jobs market in the region. That outlook chimes with actual house price growth in Manchester and Liverpool throughout 2017.

Manchester has been in the top three cities by house price growth for the past few months, according to data from property data expert Hometrack. But, even after strong house price rises, the average house price in the city was just £156,800 in October.

Not only is that price below may southern cities, including Southampton, Bournemouth, Oxford, Cambridge and London. It’s also below other northern cities; in Leeds the average house price was £161,100 in October and £163,300 in Leicester.

Manchester and north west England might seem far way to some London-based property investors, but it really does offer some real potential in terms of rental yields and capital growth,” said Assetgrove. “Property investment is a numbers game, and sometimes you need to look elsewhere to make the finances work.”

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