The phrase ‘up-and-coming’ is frequently used to describe areas that are predicted to benefit from a surge in popularity over a short period of time. For property investors, identifying which areas are likely to see an increase in demand from both buyers and tenants alike could help to maximise their investment.
Although London is home to the most expensive properties in the whole of the UK and in some areas of the capital average rents can reach up to £2,000 a month, so with properties outside of the capital costing far less, a number of landlords are now finding rental yields of up to 8.7 per cent in the other areas of the UK.
In the infographic below we assess which parts of the UK are increasingly becoming property hotspots due to improving and convenient transport links, increasing student populations, moderate property prices and investment in local amenities and attractions.
How to identify a property hotspot
With fluctuating house prices, the task of identifying which areas to invest in is becoming increasingly challenging for buy-to-let landlords.
However, when considering which parts of the UK are most likely to benefit from growth in years to come, there are a few signs to look out for:
When an area benefits from significant investment in local transport, it’s not uncommon for nearby house prices to rise and landlords to see an increase in demand for their properties.
For example, many home owners in Manchester have seen the value of their properties increase in recent years while landlords have seen rental yields of up to 7.98 per cent following the expansion of the city’s Metrolink tram service.
“The ripple effect”
When a particular area becomes a property hotspot, it’s not uncommon for the surrounding towns and villages to also see an increase in demand. This is because those priced out of the market often move to the outskirts of their desired location.
This is often referred to as “the ripple effect”. By identifying existing hotspots and assessing whether nearby areas also have the potential for growth, investors could find modestly priced properties which may increase in value.
Aldermore is a British bank that specialises in providing landlords with buy-to-let mortgages. If you’re looking to make the most of rental yields in popular areas please don’t hesitate to get in touch to find out about the buy-to-let mortgages we have available.
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