We’re back again to unveil where our buy-to-let property investment hotspots are for 2020. Most investors would love to have a crystal ball to see where they should be investing and it’s a question we get asked on almost a daily basis.
Luckily for you, you don’t have to do any serious thinking or guessing because Rob & Rob have done all the groundwork for you in this podcast episode. And, if you listened to their review of 2019 predictions, you’ll know that they were pretty spot on.
So, what’s happened in the last 12 months since we did our 2019 hotspot predictions?
Quite a bit, actually.
We had another general election and Brexit finally happened – although we’re currently in transition and there’s not been any actual movement in terms of property yet.
According to Hometrack, ‘average UK city house prices increased by 4.4% over the last year’. And they expect the forecast for 2020 to ‘be driven by affordability factors and cityhouse prices to increase by +3%’.
With this in mind, it doesn’t come as a surprise that our top cities to invest in were experiencing a fair bit of growth – between 3.6% – 4.7% from November 2018 to November 2019.
So, what are our top cities and towns to invest in buy-to-let investment property for 2020? We’re about to tell you…
In at number one is none other than Liverpool. In the second half of 2019 we were constantly hailing Liverpool as not only one to watch, but a city to get in on ASAP! Liverpool has constantly been in the media over the past six months, and rightly so.
It’s a city that has benefited from Manchester powering on over the past few years, but Liverpool is completely different to Manchester and has so much going for it.
There are top universities, the port, a top tourism industry and projects worth billions in the pipeline such as Liverpool Waters.
Liverpool isn’t on the mainstream radar for investors. House prices in Liverpool are considerably lower than nearby cities and has the best affordability of any city in England. So there’s a lot of potential for prices to rise.
Over the past 12 months Liverpool’s house prices have grown by 3.8% with average prices coming out at around £121,000 – approx. £50,000 less than neighbouring city, Manchester.
Even across the water in Birkenhead there’s an expected £1 billion worth of development and investment being ploughed into the area which, together with Liverpool, are certainly going to compliment each other.
And if that wasn’t enough to make you want to invest in Liverpool, we’ve put together a whole separate article on why you need to be adding this incredible city to your hit list.
This one probably won’t come as a surprise – we’re forever worshiping Manchester and shouting about just how great it is. It was only just pipped to the number one spot by Liverpool but we can’t deny Manchester a place in the top three.
You may remember at the beginning of 2019 when we moved our head office to Manchester city centre and it just enhanced what an incredible city this is. We even launched our most successful deal of the year in Manchester which was Deansgate Square, and we didn’t do it just once. We launched it FOUR times (across four phases).
As the tallest pure residential development in the UK, Deansgate Square is iconic. And it’s not stopping there. Developer Renaker is taking Manchester by storm and what they’ve got in the pipeline alone is set to see Manchester continue to soar.
Manchester is a safe bet that’s been performing exceptionally well over the past 2-3 years and that’s going to continue. The city has had a lot of growth in the last couple of years, so it won’t explode if you invest now, but you’ll still experience growth because SO much is happening here.
As well as buyer demand and businesses moving into the city centre, there’s an influx of students staying on and living in the city, post graduation. So it really is a city that’s booming with an incredibly strong economy.
Average house prices in Manchester at the end of 2019 were around £173,000, which was the highest average of all northern cities but nowhere near the average house price of London which was a whopping £479,000!
There’s so much more that we could say on why you should invest in property in Manchester in 2020, and we explain all in this article.
This year we struggled to pick our top three, so we’ve decided to give a joint third place for both Leeds and Nottingham.
Leeds and Nottingham are both affluent cities with great universities, fantastic transport links, wonderful employment opportunities, strong economies but low house prices.
2019 house price growth wasn’t anything hairraising but decent figures nonetheless with Leeds at 3.6% and Nottingham 3.9%. However, combined with fundamentals, they’ll certainly be strong performers in 2020.
One thing that bothers us about Leeds and Nottingham is why they’re still under the radar!
We’re not quite sure why Leeds and Nottingham aren’t higher up on investors’ hit lists, and let us tell you why.
Leeds: Leeds is undergoing the largest regeneration project in Europe, and has been for the past couple of years. So you know that capital growth and demand is simply going to boom here.
The regeneration of the South Bank area is phenomenal and is aiming to double the size of Leeds city centre! The project will see 253 hectares of land transformed, creating over 35,000 jobs and 8,000 homes.
There are already a number of businesses based in the South Bank location, however the development of the area aims to create a global location for investment, creativity, leisure and living. It’s also the proposed spot for a new HS2 station, so should the plans go ahead, this will have a huge impact on Leeds’ connectivity with the rest of the UK.
Due to the amount of regeneration, infrastructure and development going on in and around Leeds, the city and surrounding areas will be unrecognizable over the next 10 years. With even more projects still to break ground, it’s certainly the time to be turning to Leeds for investment opportunities.
Nottingham: Like Leeds, Nottingham is also seeing a vast amount of regeneration. You only need to take a read of this article to see just what’s going on around the city in 2020.
The biggest development being the £250 million transformation of the Broadmarsh area, which includes the new £89 million intu Broadmarsh, which will see the creation of a new shopping centre, car park and bus station. Work already began in 2019 with the project due for completion in 2021.
In a recent article, it’s said that £2 billion of investment in Nottingham was driven by the rental boom. This city is a very strong contender for PRS too, which is a faster growing market than the likes of London and Birmingham.
With the amount of investment being ploughed into Nottingham to completely transform the city into one where businesses will soon be relocating due to it’s excellent connectivity, you should certainly be considering Nottingham as your next investment destination.
Crewe quite easily takes the top spot on our list of towns that you should be investing in this year. If HS2 is delivered, Crewe will be the best connected town in the UK! It’ll be commutable to Manchester, Leeds, Liverpool and even London in under an hour. Which seems crazy to wrap your head around.
We loved the area so much that Property Hub Homes decided to build a development there.
However, HS2 isn’t yet a certainty so don’t make an investment based on just that, but Crewe has a lot to offer already, including fantastic connectivity. Being just off the M6 motorway, it’s a central hub for connecting train journeys, it has attractive yields and there are already major employers in the area.
There’s also massive regeneration plans for Crewe, which will create 37,000 jobs across 590,000 m2 of commercial development by 2043. However 2020 seems to be the year that these regeneration plans truly kick in and start the transformation process of Crewe. Watch this space.
Next up we’ve got Doncaster.
Now this may seem like an odd choice to peg as one of our 2020 buy-to-let property investment hotspots but we’ve got good reasons to.
Partially due to its connectivity, a lot of companies choose to be based in and around Doncaster. It has its own landport and because of that the rental market is red hot there and yields are attractive too.
Doncaster is also home to a huge regeneration scheme, one that will create nine new development zones within the city. There’s a vast amount of money being ploughed into creating a vibrant atmosphere in and around Doncaster. And some regeneration plans have already come to completion, such as the £7.7 million Herten Triangle development that was completed in April 2019.
Not only is Doncaster a thriving city itself and is more than capable of generating the fundamentals to make it a fantastic location to invest in, but it’s also a prime spot to benefit from the ripple effect of neighbouring cities such as Leeds, Nottingham and Sheffield. Two of which you know, took our joint third spot.
If you’re still not sold, you can read more about why we think you should invest in Doncaster right here.
And last but not least, we couldn’t forget about Greater Manchester. We know we mentioned Manchester city centre in our top three cities, but there’s that much going on in the surrounding areas that we had to give it a mention.
This is another prime location that is massively benefitting from the ripple effect. There are so many jobs being created and so much happening in the city centre, with prices growing phenomenally, that growth is going to ripple out and benefit the wider area.
For property investors, this means there’ll be loads of investment opportunities to take advantage of, particularly in well connected areas to the city centre, like anywhere on the tram network. But don’t just look at the current tram network, because this is being extended massively – so take note!
Two locations that we can name off the top of our heads are Bolton and Stockport. Now Stockport you might not think is a million miles away from Manchester city centre but there are certainly improvements to be made to public transport and this is definitely a step in the right direction.
If you’re wanting to keep your eye on the Greater Manchester area, then this map of the potential tram network expansion over the next 20 years may give you a bit of insight into where you should be looking to invest for the long term.
First of all, don’t take our words as gospel. What may work for someone else might not work for you, and these locations we’ve picked might not suit your strategy or goals.
Before diving into buying property left right and centre in any of these locations, you still need to do your thorough research and due diligence.
One thing is for certain, you need to be considering the fundamentals of each area to see if they stack up for you and offer the type of property investment opportunities you’re looking for.