The final season of Game of Thrones has concluded, so we thought it would be a good time to capture the “Rise of the North” in a property sense. Many have reported that Brexit may negatively affect property prices in the UK – but is this true?
A majority of the UK’s southern cities has seen a decrease in the volume of properties sold in the last four years. However, on the other side of the scale cities such as Liverpool (19%), Glasgow (12%), Birmingham (5%), Nottingham (4%) have enjoyed an increased volume of the property sold; let’s explore why.
The city of Liverpool is notorious for its love of football (Everton FC and Liverpool FC), but it is now commonly known within the buy-to-let market as a sought after location to operate from.
In terms of infrastructure investment, Liverpool has a lot happening, with the well documented development on HS2 is due to conclude in 2033. But most promisingly, as part of Everton FC’s planned proposal of a new £500 million stadium, the local area is likely to be regenerated.
Therefore, those who are interested in serviced accommodation i.e. AirBnb can potentially benefit from short-term yields of around 30% (occupancy rate at 60%), according to Portico Host.
Liverpool city’s council has recognised how their local economy has flourished from the buy-to-let market. In response they have digitised their Local Land Charges register which will expedite the property purchasing process for investors, local authorities and property lawyers.
When it comes to being involved in the technology industry, Glasgow does not come to mind immediately. However, moves made by major corporations such as Barclays, Morgan Stanley and Tech Nation Community (Government funded) has seen Glasgow turn into a thriving tech hub.
The pivot from ‘traditional’ industries, such as oil and gas, has been reflected in the forecasted job creation. Barclays has committed to creating at least 2,500 jobs on top of developing its campus based in Buchanan Wharf.
If that was not enticing enough, the city was recently ranked 3rd by Zoopla when it comes to buy-to-let yields. According to the online estate, Landlords can expect a yield of almost 8%!
Additionally, reports from Hometrack suggests that it is one of the cheapest cities to purchase a property alongside Liverpool.
Quite interestingly Rettie & Co estate agents have reported a huge increase of English investors in Scotland. Their simple assessment was because there is, “A lack of stock on the sales market, it means people are looking to rent instead”, which presents the city as an attractive option to most UK property investors.
In terms of the 'cheap' property prices that can be found in the midlands and further north, Birmingham sits within the mid-range, averaging at £164,000 per property, according to Hometrack's latest report.
This is still great value at the moment, considering the amount of investment in infrastructure Birmingham is due to gain and now its seemingly international appeal by hosting the 2022 Commonwealth Games.
It is estimated over the next decade, Birmingham's economy will receive at least £2.9 billion worth of investment through projects and events such as; HS2, Paradise Birmingham, Smithfields regeneration, 2019 ICC Men's Cricket World Cup and 2022 Commonwealth Games.
If that was not enough, the Office of National Statistics reports that the Midlands has seen the fastest rise of house prices within the UK at 4.2%. Hence, for any savvy investor, Birmingham is a difficult city to ignore.
25% of Nottingham’s population, is aged between 16 and 24. As highlighted in our previous blog, this age group now consists of a large proportion of long-term renters.
This presents an appealing opportunity for most buy-to-let landlords, alongside the optimistic forecast of property prices rising by 19.3% in 2023, according to Savills.
It is of course impossible to accurately predict such rises in four years’ time. However, a strong indicator of the future could be based on recent historical figures shared by the UK Land Registry.
On average in 2018 property prices in the UK rose by 2.5%, whereas Nottingham boasted a rise of 4.2% - close to double the rate!
When it comes to infrastructure and service, the city centre will be renovating its degraded shopping centre that will see renovations including, new cinema, bars and restaurants. HM Revenue and Customs will open a new office in 2021 that will introduce 4,000 new jobs in the local area and of course they will need ample accommodation to match.
As great as these options sound, it’s always useful to beware of the typical pitfalls that can be found with buy to let markets. Read our previous blogs for more information.
We also have a cash reward referral scheme for anyone that connects us with landlords successfully.
Normette Homes specialise in providing guaranteed rent and free management services.