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FEATURED LOCATIONS

We would all love to be able to predict the future of the property market and know precisely which are the best locations to invest in for 2018/19 and beyond; Who would have thought 20 years ago that Lambeth would be amongst the best place to invest in property in the UK, or Hackney property prices would have risen by over 750 per cent?

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There are many options available to clients looking for an investment property in the UK.

Below are four cities which we feel will offer good opportunities for the right investor, whether that be a focus on capital appreciation or more on rental yield, or both. We are not limited to these specific locations, and clients are welcome to share with us locations of interest and then we will search the market on their behalf for suitable options.

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These are The Blue Point Group’s tips for the best places to invest in property in the UK…

London
LONDON
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London being the Capital City will always attract interest from both the domestic and international market when it comes to property investment. With overseas investors accounting for around 40% of purchases during 2017, the proposition of having a London property in your portfolio is still very desirable.

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There is a shortage of good quality housing which has in turn created a strong rental demand. Vacant properties do not stay on the market long, far from it, quite often there is no void period from completion, or between tenants. Very professional clientele working in the City means a need for good quality rentals. 

London has great transport links, and is something that the government is investing a lot of money in to improve further (such as the Cross Rail scheme which will open up in 2019).

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As the UK faces a period of moderating growth and uncertain politics, prime assets with attractive income profiles could prove scarce. The London property market provides just that. It is seen as a stable safe haven for many investors. A slowdown has taken place in the expensive inner London markets, while prices and transaction levels have held up in the outer zones. Some markets have rocketed off a low base because they have effectively been repriced, largely because of transport improvements and that ‘value for money’ appeal pushing further out.

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London still has a strong position in anyone’s property portfolio; the price point is high but it is the Capital, and has proven over many decades  (including times of economic uncertainty), that the market remains stable and has delivered consistent growth and rental yield.  

Birmingham
BIRMINGHAM
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Birmingham is one of Europe’s most vibrant cities and has become a highly sought-after city in the UK for property investment.

It’s financial centre will be home to HSBC and Deutsche Bank UK headquarters, plus it has many other house-hold names, such as Waterhouse Coopers (PWC), Pinsent Masons LLP, and the Midlands regional hub for HM Revenue and Customs (HMRC) to name a few.

 

Birmingham has active working canals and top-end shopping and entertainment districts. 2017 proved to be an exceptional year for occupier activity as both residential firms and new entrants vied for city centre space, with office take up increasing by 45%. Professional Services continue to form the largest source of demand with 30% take up, with the Royal Institute of Chartered Surveyors (RICS), Hogan Lovells, and Arcadis being other notable firms to take new space in 2017.

 

There is a debate about whether Birmingham remains Britain’s second city, but it’s certainly the second largest with almost 4.5 million people. One of the biggest developments happening in the city is the construction of the High-Speed Rail (HS2) providing access to London in 49 minutes (by 2026). A chronic shortage of rental accommodation is driving up property prices, with a ripple effect from the gentrified Jewellery Quarter. Birmingham is expected to have +23.5% estimated capital appreciation and +20% rental income growth expected from 2018 to 2022 (Knight Frank)

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2017 has seen strong investor interest sustained, and with only the limited number of opportunities, particularly at the prime end, this has restricted the market and maintained demand.

Liverpool
LIVERPOOL
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Since its success as the European City of Culture in 2008, Liverpool is one of the core places being targeted by the government’s Northern Powerhouse proposal, a push to be given more powers away from London’s Whitehall. Famous for its two Premier League football clubs, world-renowned music scene and important industrial history, Liverpool is now classed as one of the best places in the country to invest in the buy-to-let sector.

 

Liverpool is benefiting from large-scale job creation and inward investment. The city is currently undergoing a £14bn overhaul led by the city council, with a number of redevelopment and regeneration projects taking place throughout the city. It is expected to benefit from the creation of 38,000 new jobs and 35,000 new homes between now and 2033, new stadium for Everton Football Club, £250m of road infrastructure and two million square feet of commercial office space, with the population forecast to rise above half a million. London is two hours away by rail, which is expected to reduce further with the development from the HS2 line.

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Yearly population growth in Liverpool continues to ensure the longevity of residential property demand in the area for the foreseeable future, and further to this, tourism has generated over 49,000 jobs over the past few years – Liverpool is the fifth most visited city in the UK. There are currently over 500,000 businesses located within 1.5 miles of the city centre. A huge student population is already being drawn to Liverpool’s four universities, with 60 per cent of graduates opting to remain here long-term. With low property prices, excellent infrastructure and a rapidly expanding business district, it provides a great opportunity for property investors.

Manchester
MANCHESTER
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A recent report by KPMG suggests the North West will see some of the UK’s highest average house price growth during the next decade. The City of Manchester will play a big part in this, particularly with the UK Government’s focus on the creation of the Northern Powerhouse.

 

The fastest-growing city outside London hosts some of the UK’s largest regeneration projects, spearheaded by the media-powered Salford Quays complex and digital-oriented Northern Quarter. Salford’s Media City hub, home of the BBC regional headquarters, have been a huge boost to the local economy, and really enhanced Manchester’s appeal to businesses, including Granada and ITV. Financial services, engineering and technology sectors have also grown exponentially due to regeneration initiatives by the Government. With growing career opportunities available in Manchester, the city is becoming an increasingly popular choice for young professionals.

 

Last year it was announced that Manchester International Airport, which is already the UK’s largest airport outside of London, is to receive a £1bn investment to increase its size further, and cater for more international passengers. On a local level, Manchester is also within a two-hour train ride from London, and boasts direct rail links to many of the UK’s other major cities. Furthermore, Manchester is at the centre of the new HS2 project. The city is home to five main stations, a Metro rail tram service, which links destinations across the city.

 

In 2018, the relative lack of buying opportunities combined with a sustained level of investment seeking deployment in Manchester will continue to apply upward pressure on pricing. Prices are rising rapidly, yet yields still average around 5%.

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