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Which UK City Is Best For Property Investment – 2023 Guide

Investing in UK property can be a tricky business sometimes. And there is no secret that house prices in the UK are constantly increasing. But looking for the best property is a big deal, especially when you need ideas about which city to look for better and more returns.

For property investors seeking to invest in the UK real estate market and seeking which city or town is the best, then here’s a write-up to guide you. In this blog, we have jotted down all the names of the top seven cities that are expected to witness a boom in the real estate market in the next five to six years. Furthermore, a survey found that over 50.45% of investors are looking forward to investing in the real estate market, and it can be a great UK property investment deal for you.

So, read on to find out the top cities and towns in the UK that are worth property investments in 2023.

1. Birmingham

Source: luxurylifestylemag.co.uk

Due to sheer regeneration, growth, and demand, Birmingham forecasts in the coming years, it is the best UK city to invest in property in 2023. With a revolutionizing Big City Plan, Birmingham is expected to get many public spaces and multi-purpose, used developments. Furthermore, the city is primarily made up of single & two-bedroom houses and apartments. The city is also known for its quick transport links to London, which reduces travel time to 49 minutes.

In the past ten years, the average property rent in Birmingham has risen by 30% and is expected to increase by 12% in the coming five years. When talking about the current scenario, the average property rate in Birmingham is £206,500. And the current average rental yield is 5.30%, which is expected to reach 12% by 2026.

2. Derby

Source: derbytelegraph.co.uk

Located in the heart of the country, Derby is an easy option for property investors in 2023. Bridging the gap between the North & South, the city is undergoing a vital regeneration project called the “2030 Derby Masterplan”. Because of this, the Derby property investment market is expected to increase by 17.5% in the next four years.

Derby is a city with 17 top-notched universities, all located within an hour’s travel vicinity. Currently, the city is a base for more than 34,000 students; therefore, Derby’s 48% population comprises people of the age group under 35 years. And it is the 6th most productive city in the UK. The average property price in Derby is £180,966, and the average rental yield is 6.07% which is expected to increase by 12% in the year 2026.

3. Manchester

Source: travelandleisure.com

Manchester’s highest predicted property growth in the UK is 28%. The city’s population is primarily driven by its historic capital, and its property value has increased by 20.6% in the past five years. Although the city does not top your population list like others, it has over 1,00,000 students and a great graduate retention rate. All this makes the city of Manchester an ideal rental hotspot.

Manchester is the largest regional economy. When talking about the average property rate, the city witnessed £232,500 with an average rent percentage yield of 5.17%. The property rates in Manchester are expected to hike by 28% in the coming four years.

4. Sheffield

Source: shoosmiths.co.uk

Sheffield is another best cities to choose for property investment in the UK. Currently, in the early stage of development, about £480 million has been spent on the retail sector development of Sheffield. And due to this, the property rates in the city are expected to increase by 28% till 2024.

Currently, the average rate of the real estate structures in Sheffield is £192,362, and the average rental return is 4.45%. As per a report, the rental growth prediction of Sheffield for 2026 is expected to be 26.40%

5. Liverpool

Source: hotels.com

Due to exceptional potential in property returns and rental affordability, Liverpool is yet another most consider UK property investment hotspot. In the next four years, the real estate value of the city is predicted to increase by 28%. The average area value of the Liverpool real estate market is £164,550.

The average rental return of Liverpool is currently 5.23% which is expected to increase by 36.03% in 2026. The city is an ideal student destination with a total value of about 70,000. Furthermore, Liverpool is the ultimate business start-up hotspot alongside Manchester and Birmingham.

6. Newcastle

Source: expedia.com

Newcastle is one of the most affordable cities on the list. And it is the 8th largest city in the UK in terms of population. Often known as an ideal “Start-up incubator” of the country, the city attracts thousands of entrepreneurs to set up their retail businesses and provides excellent employment opportunities to young professionals. Newcastle is the best area to invest in property in the UK.

As per the reports, Newcastle’s average property rate is £177,877. And the average rental return for Newcastle properties is 5.10%, which can be increased to 12.38% by the year 2026.

7. Leeds

Source: gq-magazine.co.uk

Often recognized as Yorkshire’s powerhouse, Leeds is yet another best UK property investment cities offering excellent ROIs. The city is the country’s second-largest finance and banking sector and pulls the maximum population of young working professionals.

In terms of economy, Leed is the fastest-growing city. With a total population of 800000, around 73% of the households in the town are on rental agreements, attracting investors seeking long-term tenant demand. The average property rate in Leeds is £172,000, and the average rental ROI is 5.27%.

Summing Up

So these are the top seven best places in the UK worth considering for property investment. If you are looking for growth in real estate investment in the UK, and that too for the long-term, then the cities mentioned above are worth considering. Each of the cities, as mentioned above, has its specialty and identity with its average rental return benefits. Investing in a house or property in any of these cities will help you enjoy maximum profits in the long run.

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