What are the top property investment hotspots in the UK?

Despite economic uncertainty in the wake of Brexit and the coronavirus pandemic, property has once again proven its resilience and reliability as a safe investment. In this article, we’re going to focus on UK property investment hotspots, and how the stamp duty threshold might affect future purchases now that the stamp duty holiday has ended.

Understanding the current health of the UK property market

It is fair to say that the previous two years have demonstrated the diversity of the UK property market. While Covid-19 may have altered the preferences and behaviours of some home buyers and property investors, market performance has remained steady - as evidenced by the growth in average house prices.

According to the Office for National Statistics, the value of the average home in the UK had increased by over 13% between June 2020 and June 2021. While some measures designed to stimulate the market have come to an end, many are now questioning how dynamics in a post-pandemic world will shape investment decisions. However, investor appetites remain strong, with many seeking out areas of high capital growth and healthy rental yields to invest in.

Property investment hotspots: where are property prices rising fastest in the UK?

According to recent statistics, the North of the UK is performing best in terms of both capital growth and rental yields. Cities like Manchester and Leeds are doing particularly well from an investment perspective, and it’s easy to understand why.

In recent years, both of these cities have witnessed a huge amount of investment and regeneration, along with an increase in population size. Manchester is home to several prestigious universities and is now home to Europe’s largest student population, which in turn has helped attract a large number of multinational businesses and technology start-ups. The effect of this regeneration has meant that the average city-centre house price has risen by almost 6% in recent years.

Leeds is similarly home to a large student population, in addition to being one of the UK’s largest financial districts outside of London. The city is home to a plethora of new-build apartments, with economic activity predicted to grow within the area by more than 20% over the next decade. Property prices are set to rise in tandem, making Leeds one of the best places to invest in property at present.

Property investment in the South of the UK

Cambridge is currently enjoying economic growth and is currently rated as the easiest place in the UK for professionals to find employment. As home to one of the world’s most prestigious universities, it is perhaps unsurprising that trailblazing science and technology companies - including AstraZeneca, developers of the UK’s coronavirus vaccine - have made the city a base of operations.

With plenty of lucrative employment opportunities in the area, it should come as no surprise that newcomers to the area also need somewhere to live. This in turn drives up both rental yields and capital growth.

Is London still one of the best places to invest in property?

Property in London is highly-coveted, and as a result, prices are high. Despite this, approximately 40% of investors have plans to purchase property in the capital in the coming year.

While some speculated that London may have lost some of its appeal as a place to live and work (and ultimately as a place to invest), research demonstrates that it is still a primary focus among investors. As a busy and vibrant city, areas previously considered neglected or of low investment value are constantly experiencing regeneration. Many investors consider Whitechapel, Walthamstow and Hackney as up and coming property areas within the capital.

Stamp duty calculator 2021: how your investment could be affected

To stimulate the economy during the Covid-19 pandemic, chancellor Rishi Sunak announced a stamp duty holiday back in 2020. This meant that many property buyers were able to save thousands on Stamp Duty Land Tax.

Now that the stamp duty holiday has ended, investors are finding themselves having to pay stamp duty once again. It’s worth noting that the stamp duty threshold differs depending on whether you are a buy-to-let investor or buying a home to move into. To help you understand how stamp duty works, and to work out how much SDLT you can expect to pay on a property, why not try using the SDLT calculator?

Where is the best place to buy property UK?

The best places to invest in property in the UK will depend on your investment style. If you’re a hands-on investor looking to maximise rental yields, you might want to consider doing your own administration work and repairs. In this instance, it makes sense to purchase property close to where you are based.

Where should I invest my property in 2021 UK?

Before considering how to invest in property, it’s a good idea to consider what you want from your investment. Are you looking to become a landlord and provide services for your tenants on a local level, or are you happy to purchase property further afield with the express purpose of profiting from capital growth? Once you’ve established this, you’ll be in a better position to consider where to invest.

Find out more

Whether you’re an experienced portfolio holder or wondering how to invest in property for the first time, it is advisable to have the right tools at your disposal. With PropertyData, you can access a wealth of data and analytics to help facilitate more informed investment decision-making.

PropertyData offers a free two-week trial and it’s quick and easy to sign up - so why not take a look today?