Savills research reveals top ten BTL cities

Savills research reveals top ten BTL cities

For many years, London has been the darling of the property investment market, providing high yields and booming tenant demand. However, with sky high property prices in the capital, investors are looking further afield for the opportunities.

New research from Savills has analysed the key drivers for the rental market and identified the top cities for buy-to-let investment.  The top three positions go to Manchester, Reading and Bristol, because of their strong economic growth factors and reputation as vibrant, desirable places to live.

Though this is not an exhaustive list, Savills has highlighted investment prospects in cities set to experience a significant housing shortfall, such as Oxford.  The research examined the economic prospects of each city, which included analysis of historic and future growth sectors.

The research also looked at the investment potential of each city, by taking into account the net income return, rental growth prospects and capital value growth; housing supply and demand in each city, including objectively assessed need, household projections, population growth forecasts and dwelling completions; and how the rental market has evolved and grown in
these cities.


Top Ten Cities for Investment

•  Manchester
•  Reading
•  Edinburgh
•  Bristol
•  Brighton
•  Leeds
•  Glasgow
•  Cardiff
•  York
•  Milton Keynes
•  Salford
•  Birmingham
•  Oxford

Peter Armistead of Armistead Property comments: “House prices in London are about five times what they are in Manchester, but salaries are only 30% higher.  Manchester is a very affordable place to live and demand for property is soaring in the city, thanks to the expansion of the MetroLink tram system, the trendy Northern Quarter and the BBC Media City.
 
Manchester has vibrant restaurants, bars, clubs plus a great music scene, galleries and museums. It also has an amazing student community and its universities, teaching and research facilities are truly world class.  It is home to nearly 100,000 students, making it one of the largest student cities in Europe. Despite all of its many advantages and attractions, Manchester is a very affordable place to live and many students chose to carry on living there after they graduate, as well as graduates from other areas moving to Manchester. Furthermore, wages relative to property costs are a very important factor in attracting these people.

Manchester is a great place for BTL investment. An average residential property in Manchester is just £155,000, while a flat in a good area, costs as little as £120,000.  A property in the city can provide a 5% minimum cash rental yield and a typical 12% total cash yield, including 7% capital appreciation.  Demand for rental accommodation is strong and by comparison with other regions, housing is cheaper.  
 
It’s not surprising that investors are turning away from London to more fruitful, regional cities like Manchester.  If investors can purchase cheaper properties with better yields, they will have the opportunity to protect and boost their profits in the longer term.”

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Latest Comments

AbbieP.
AbbieP. 22 Jul 2016

"While house prices in the most expensive eleven boroughs have declined values in the cheapest eleven boroughs continue to rise" - not a nice way to even out the price range. London is overrated as it

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AbbieP.
AbbieP. 21 Jul 2016

And try to profit from your decisions, I may add

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CommercialTrust
CommercialTrust 19 Jul 2016

Retirement investment has always been one of the biggest draws of buy to let. And the buy-to-let demographic is, on balance, older. (Over a third of our applicants are over 50 at the time of application.) It...

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Forrest Wheatey
Forrest Wheatey 11 Jul 2016

I find the time perfect for ever home-owner wannabe. Prices should slowly, but steadily drop, at least for the inner buyer. Making it harder for outsiders to buy properties (the whole Brexit thing means...

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property guru
property guru 11 Jul 2016

Why should Ajay even have to be looking for it. It should be public knowledge. Why is not just publish each years and to were it is and be AUDITED. Accountability.

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property guru
property guru 11 Jul 2016

Surprise suprise

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CommercialTrust
CommercialTrust 30 Jun 2016

This is great news for buyers and investors in a period of significant uncertainty. The 10-year buy-to-let fix at 3.99% in particular is excellent, a clear 100 bps ahead of the nearest competition. Though...

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Lee
Lee 30 Jun 2016

Let's see what happens to north-east property prices when Nissan announce they're leaving.

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DmitriKara
DmitriKara 29 Jun 2016

I just read another article about eviction rising and this was exactly what was on my mind, Housing has become "cat and mouse"...

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DmitriKara
DmitriKara 29 Jun 2016

I am really not surprised. I've seen one too many impudent tenants and in my humble opinion renters have one too many privileges and options to abuse heir landlord in so many ways...

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DmitriKara
DmitriKara 29 Jun 2016

There is still so much uncertainty and I will surely step back and see what's happening before I could make any decisions on my end.

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ChristinaReedUK
ChristinaReedUK 20 Jun 2016

I don't understand why it's always a war between the two sides. Either, way the landlord is probably keeping a detailed inventory and will see the changes you've made. I just don't understand why there...

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