It shouldn’t come as a surprise to anyone in the least interested in the prospects of the UK property market to see that of the top five cities to invest in property outside London, Manchester sits snugly amongst the leaders.
The city which last year boasted the third highest number of foreign visitors in the UK does, after all, make a huge claim as the new home of the BBC as well as fostering a flourishing media community.
But more on that later. Also up there in the palm of prosperity sit Glasgow, Liverpool Birmingham and Bristol. The city claims are based on insurance company Hometrack’s latest house price survey published last month, which showed the increase in house prices today compared to 2007, just prior to the credit crunch. We’ve also done our own analysis by looking the likelihood of future house sales thanks to redevelopment and a move northwards by investors out of London. The latter is mainly a response to the three per cent tax on second homes and higher London house prices in general.
Best Cities to Invest in Property
Here we look at each of the five cities in turn and reveal why it’s not a bad idea to consider properties in any one of them as a boost to your investment portfolio:
Scotland’s second largest city after Edinburgh, this much more affordable neighbour is home to Scotland’s media industry, based in the Digital Media Quarter at Pacific Quay. Glasgow also boasts a number of huge blue chip companies such as Morgan Stanley, esure, JP Morgan, Aon and Paribas – to the extent one in 13 employees in the city work in financial services. The average house price here is £155,221, with a typical one bedroom flat in the city centre renting for £602.17 per month.
The former home of the Beatles has benefitted from £5 million in regeneration funding over the past few years with a further £7million of development planned for the next 10 years. Economists reckon 95,000 new jobs will be created in Liverpool over the next four years. The city is also home to more fast-growing firms than anywhere else in the UK, according to a survey published earlier this year by the Enterprise Research Centre. The average house here costs £103,598 while a one bedroom in the city centre rents for around £548.19 per month.
With the promise of journey times into London in under an hour on HR2, Birmingham is set to spend more than £1bn over the next three decades creating 36,000 jobs and 4,000 new homes. Biggest employers in the region include National Express, Sainsbury’s and Lloyds Banking Group while the Science Park at Aston is home to 86 technology companies. The city is by far one of the best cities to invest in property and even boasts also four Michelin-starred restaurants. The average house price here is £144,943 while one bedroom flats in the city centre let for around £701.32.
One of the major regeneration projects in the area was the Bristol Temple Quarter Enterprise Zone which has created more than 1000 jobs to date but aims for a further 16,000 over the next 25 years. Once HR2 arrives (planned for 2018) journey times into the capital will reduce to just 80 minutes. Bristol, together with Bath, was named by a government-backed report as the UK’s most important centre for ‘the fast-growing digital industry’ outside of London. The average house price here is £263,294 with a typical one bedroom flat in the city centre renting for £825.50 per month.
The city’s NOMA project aims to create a whole new neighbourhood at a cost of £800 million over the next couple of years. The main artery of the area, One Angel Square, is the HQ of the Co-op group and cost £105 million to create three years ago. Spinningfields Business Centre was a £1.5 billion which is almost complete. The huge park is home to major companies such as Regus, Barclays, Deloitte, HSBC Bank and the Royal Bank of Scotland. House prices in Manchester average £142,508 with a typical one bedroom city flat going for £693.65 per month.
It makes sense to look northwards now that property in London no longer creates the high yields many investors enjoyed up until a couple of years ago (in fact, house prices in Bristol have been rising higher than those in the capital over the last six months, according to Hometrack).
The above five cities all provide better value in that respect. And with more individuals and families moving out of London unable to afford such high rents, these five hot spots are looking increasingly attractive to investors and buy to let landlords as time goes on. Just don’t hang around too long…