As an investor looking for the best places to invest in property in the UK, you want to ensure your money is positioned for solid returns. Finding suitable locations to invest in real estate can be challenging if you’re unfamiliar with local markets and growth areas. However, by tapping into the knowledge of industry experts, you can gain valuable insights to guide your investment decisions.
Following several analyses, our UK investment specialists came up with this guide outlining the best places across the UK to invest in property. From up-and-coming neighbourhoods poised for capital growth to established areas offering stable rental income and property prices, you’ll discover key locations you should have on your radar. With data-backed recommendations from specialists in the field, you can invest with confidence knowing these spots are predicted to outperform expectations.
The 8 Best UK Property Investment Areas
In summary, here are our top picks for prime property investment areas in the UK:
| Place | Summary | Population | Property Price (Average) | Rental Yields (Average) |
| London | A Perennial Favourite for Property Investment | 9,648,000 | £525,629 | 2–5% |
| Manchester | A Northern Powerhouse for Capital Growth | 2,791,000 | £301,779 | 6–7% |
| Birmingham | An Up-and-Coming City With Strong Rental Demand | 2,665,100 | £274,781 | 6.56% |
| Liverpool | A University City With Lots of Potential | 917,000 | £217,016 | 6% |
| Leeds | A Thriving City in Yorkshire | 818,000 | £255,391 | 6.3% |
| Nottingham | An East Midlands Hotspot for Property Investment | 807,000 | £258,453 | 2.9–8.2% |
| Bristol | A Vibrant City in the South West | 707,000 | £399,540 | 5.1% |
| Leicester | A Hidden Gem in the East Midlands | 566,000 | £282,174 | 4.19% |
1. London: A Perennial Favourite for Property Investment
- Population: 9,648,000
- Average Property Price: £525,629
- Average Yields: 2–5%
London has long been a top choice for those seeking the best property investment in the UK, and for good reasons. As one of the world’s leading financial centres, London offers stability, growing property prices and substantial capital growth opportunities.
Based on our analysis at API Global, London’s prime central areas should be at the top of any investor’s list. Neighbourhoods like Kensington, Chelsea, and Mayfair offer prestige and substantial long-term growth. While prices are higher, rental demand is consistent, and values are more resilient during market downturns.
Outside central London, up-and-coming districts show promising potential. Areas like Canary Wharf, Stratford, and Battersea are undergoing significant regeneration and infrastructure improvements. New residential and commercial developments in these areas could yield significant capital appreciation over the next decade.
However, London’s popularity comes with challenges like higher costs and more competition. Investors should have realistic expectations about the costs and be prepared to hold properties over the long term to realise substantial gains. They should also consider diversifying their portfolios geographically to mitigate risk.
Nonetheless, London will always remain a prized market for property investment, constantly delivering for investors seeking stability, prestige, and growth. While prices are high, the city’s status endures. If you get started now, you’ll discover the rewards of investing in London real estate outweigh the risks.
2. Manchester: A Northern Powerhouse for Capital Growth
- Population: 2,791,000
- Average Property Price: £301,779
- Average Rental Yields: 6–7%
Manchester is one of the UK’s fastest-growing cities and a top location for capital growth. According to our research at API Global, house prices in Manchester have risen by almost 70% in the last ten years, an undoubtedly impressive figure. With significant investment transforming the city, Manchester’s property market is poised for further growth, making it the best place to invest in property for many with attractive property prices.
Here are some of our discoveries about Manchester:
A Thriving Economy and Job Market
Manchester has a diverse, thriving economy with significant sectors like financial and professional services, technology, as well as creative and digital industries. This strong economy and job growth fuel the demand for housing. The city was also ranked as having some of the highest job satisfaction in the UK, indicating a sustainable economic environment and a solid opportunity for property investors.
A Cultural and Transport Hub
Manchester is a cultural hub attracting young professionals. It has a renowned music scene, art galleries, museums, as well as shopping, nightlife and a vibrant food sector. Manchester Airport services over 200 destinations, and with HS2 arriving, London will be only 71 minutes away. What’s more, Metrolink trams and bus networks provide efficient transport across the city.
Hotspots for House Price Growth
Areas of South Manchester like Didsbury, Chorlton and Whalley Range have experienced significant capital growth and demand from tenants and owner-occupiers. Other up-and-coming areas include Ancoats, New Islington and Castlefield, which have attracted investment for regeneration. While there are periods of higher supply, Manchester’s economy and status should continue supporting capital growth in the long term, especially in well-connected areas.
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Manchester deserves its place as one of the UK’s top investment locations. For international property investors seeking robust and long-term capital growth and rental demand, Manchester should be high on your list of considerations. With professional support from property investment experts, the city offers an abundance of opportunities.
3. Birmingham: An Up-and-Coming City With Strong Rental Demand
- Population: 2,665,100
- Birmingham Average Property Price: £274,781
- Average Yields: 6.56%
Birmingham, located in the West Midlands region of England, is an up-and-coming city demonstrating a strong indication as one of the best places for property investors looking for a deal. According to our research at API Global, Birmingham’s residential property values have increased by over 50% in the last decade, and rental yields currently average around 6.56% due to undersupply in the private rented sector.
As the UK’s second-largest city, Birmingham is home to various industries, including manufacturing, technology, and financial services. Major employers such as Jaguar Land Rover, IBM, and HSBC have a strong presence here, providing various high-skilled job opportunities. The city also has a relatively young population, with about 42% of residents being between 20 and 49 years old in 2021. These factors indicate that demand for rental accommodation should remain robust over the short and long term.
While property prices and rents in Birmingham are lower than in other major UK cities, savvy investors are poised to benefit from future growth. API Global recommends purchasing rental property in up-and-coming neighbourhoods surrounding Birmingham’s central business district, where demand for modern housing is high. Areas such as Digbeth, Eastside, and Southside offer ideal opportunities, with new residential developments and infrastructure improvements planned or underway.
Birmingham exhibits promising fundamentals for buy-to-let investment/, with a buoyant rental market and potential for solid capital gains in select neighbourhoods. By purchasing in an up-and-coming area surrounding Birmingham’s centre and choosing a property suitable for the city’s young professional demographic, investors can benefit from future growth while generating stable rental income. With prudent due diligence, Birmingham deserves consideration as one of the best places to buy outside London – particularly if you’re looking for a rental property.
4. Liverpool: A University City With Lots of Potential
- Population: 917,000
- Liverpool Average Property Price: £217,016
- Average Rental Yields: 6%
Liverpool is a city in the North West of England, and significantly one of the best UK property investment areas. According to our analysis, Liverpool’s housing market is poised for property price growth due to several factors, as outlined below:
A Major University City
Liverpool has a substantial student population, resulting in strong demand for student accommodation and private rentals. Investors can capitalise on this by purchasing properties near the universities and marketing to students. However, there may be risks around rent collection and property damage that investors should consider.
Up-and-Coming City
Liverpool is going through a period of economic regeneration and revitalisation. New businesses are moving into the city centre, especially in the Baltic Triangle tech hub. The city’s economy is diversifying beyond its industrial roots in shipping and manufacturing.
These factors indicate the city becoming an increasingly desirable place to live and work in the coming years. Property values and rents are likely to rise substantially as a result.
Strong Rental Yields
According to API Global Research, Liverpool offers some of the highest rental yields for landlords in the UK, often over 6% per year. This is due to low property prices and strong tenant demand. As a result, Liverpool is an attractive location for investors looking to generate income from their properties, and the best time to invest in this location is now.
Transport Connections
Liverpool benefits from solid national rail and road links and an international airport. This makes the city an accessible hub for jobs and commerce. The new high-speed rail link puts London just over 1.5 hours away. Strong transport connections are favourable for any city’s economy and housing market.
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In summary, Liverpool is a prime investment location for those seeking areas with significant returns in the long run. The time to invest in Liverpool is now! Reach out to us for more information.
5. Leeds: A Thriving City in Yorkshire
- Population: 818,000
- Average Property Price: £255,391
- Average Rental Yields: 6.3%
Leeds is a city in West Yorkshire that has seen significant growth and development in recent years, making it one of the best places to invest in property. As the largest city in Yorkshire, Leeds has a population of over 818,000 and functions as an economic hub for the region.
The city benefits from a diverse and thriving economy based on financial and business services, retail, tourism, and higher education sectors. Significant employers in Leeds include Sky Betting & Gaming, Asda, and the University of Leeds. Substantial employment opportunities and economic prospects have drawn more people to Leeds, fueling demand for housing.
Leeds city centre has shops, restaurants, museums, theatres and bars. The city also has a famous nightlife scene attracting many students and young professionals.
For transport, Leeds is well connected by road, rail and air. It has its international airport and is located on the M1 and M62 motorways. The city also has several train stations with direct routes to other major UK cities like London, Manchester, York and Newcastle.
The demand for property in Leeds has increased house prices and rents. House prices in Leeds are currently higher by 4% compared to 2022. Rents have also been on an upward trend, indicating a shortage of quality housing options for the city’s growing population.
While property prices and rents in Leeds are more affordable compared to other UK cities like London or Manchester, the city has strong fundamentals pointing to solid opportunities for property price growth and high rental yields for investors over the coming years. Leeds is an ideal location for buy-to-let investors, offering both capital appreciation and stable rental income.
Overall, Leeds is a vibrant city with a bright economic outlook. It presents an attractive location for property investment in the UK, especially for those looking to benefit from future price growth. The city’s diverse economy, skilled workforce, and high quality of life continue to draw people and businesses to Leeds.
6. Nottingham: An East Midlands Hotspot for Property Investment
- Population: 807,000
- Nottingham Average Property Price: £258,453
- Average Rental Yields: 2.9–8.2%
Nottingham, located in the East Midlands region of England, is an excellent choice for many seeking the best place for property investment in the UK. As one of the UK’s fastest-growing cities, Nottingham’s economy thrives, with major employers in the healthcare, education, and retail sectors. This steady job growth and affordable cost of living have attracted more residents and driven demand for housing.
Nottingham’s housing market shows strong potential for property price growth and healthy rental prices. Capital growth in Nottingham has outpaced the national average, indicating the city is financially stable. As prices continue to rise and the stock remains limited, investors who get into the property investment market now can benefit from significant equity gain over the medium to long term.
For buy-to-let investors, Nottingham is a beautiful location. The city has two universities with over 70,000 students (1, 2), creating consistent demand for student housing and young professional rentals.
Average rental yields in Nottingham are 2.9–8.2%, providing a stable income stream for long periods. Popular areas for student lets include Lenton, Dunkirk, and Radford. Professionals prefer locations like The Park Estate, Sherwood, and West Bridgford. If you’re interested in exploring property developments in Nottingham, check out our Trent Bridge Quays development
While opportunities abound in Nottingham’s property market, investors must exercise caution. Some neighbourhoods experience higher crime rates than others, and house prices vary significantly across the city. Hence, it’s critical to consult local market experts like API Global to determine the best locations and property types for your investment goals. We can advise you on the most promising neighbourhoods, help you find ideal properties, and connect you with experienced letting agents to manage your rentals.
With a thriving economy, growing population, and undersupplied housing market, Nottingham deserves serious consideration from property investors seeking capital growth and strong rental returns. You can build a profitable property portfolio in one of the UK’s most promising investment hotspots by partnering with expert local firms.
7. Bristol: A Vibrant City in the South West
- Population: 707,000
- Average Property Price: £399,540
- Average Rental Yields: 5.1%
Bristol is a historic yet culturally vibrant city in southwest England that presents an attractive opportunity as one of the best UK property investment areas. Bristol’s housing market is poised for growth due to its thriving economy and popularity as a desirable place to live.
Here’s our take on why you should invest in Bristol’s property market:
A Strong, Diverse Economy
Bristol has a robust and diverse economy spanning aerospace, creative industries, IT, tourism, and banking. Significant employers in the city include Airbus, Rolls Royce, and the University of Bristol. The city also has a highly educated workforce. The combination of a robust, diversified economy and an educated populace points to Bristol’s housing market’s stability and future potential.
An Increasingly Popular Destination
Bristol has seen a large influx of new residents over the past decade, particularly young professionals and families, drawn by job opportunities and quality of life factors like culture, nightlife, dining, and outdoor recreational activities. This popularity and population growth have led to increasing rental prices and property values. Industry experts anticipate this trend will continue over the next several years, suggesting property investors will benefit from healthy demand and price appreciation.
Areas to Target
Investors interested in Bristol should consider up-and-coming neighbourhoods adjacent to the central city, where property values have significant room to rise. We recommend looking at areas such as Bedminster, Bishopston, Easton, and St. George which offer period properties and new developments and are located within a few miles of major employers. While prices in these neighbourhoods are currently quite affordable, we predict strong value growth over the next 3 to 5 years, which could generate solid returns for investors.
8. Leicester: A Hidden Gem in the East Midlands
Leicester, an East Midlands city in the UK, offers promising investment opportunities for property buyers seeking strong capital growth and solid rental yields. As a fast-growing city in the UK, Leicester’s population has spiked over the past decade, increasing demand for housing. We anticipate property values in Leicester will rise over the next five years due to significant investments in the city’s infrastructure and business sector. So, if you’re looking for where to buy property in the UK, consider Leicester.
For investors focused on capital appreciation, we recommend investing in Leicester’s up-and-coming neighbourhoods just outside the city centre. Areas like Braunstone, Beaumont Leys and Eyres Monsell have recently experienced significant house price growth and still have room for further increases (especially in rental prices). New housing developments in these neighbourhoods, especially near planned transport links, offer additional potential.
Regarding rental demand, Leicester’s student housing and young professional market segments show particular promise. Student enrolment has grown steadily, increasing pressure on the private rental sector. Newly built student accommodation and flats appealing to young professionals let quickly and command premium rents.
While Leicester does face particular challenges, such as pockets of deprivation and below-average wages, experts view these issues as surmountable, especially given the city’s ambitious regeneration plans. With extensive investments in skills training, public services and cultural facilities, Leicester aims to attract high-skilled, high-paying employers. Improvements to the city’s infrastructure, including better road and rail links, will also make Leicester a more attractive place to live, work and invest. You can contact us to get started.
Frequently Asked Questions
What is the best type of property to invest in the UK?
The best type of property to invest in the UK depends on various factors, including your investment goals, budget, and market conditions.
Here are three popular options:
- Residential Buy-to-Let: Investing in residential properties to rent out can provide a steady rental income. Areas with high demand, such as major cities or university towns, can offer good rental potential. Researching local rental market trends and considering factors like location, tenant demand, and rental yields can help inform your decision.
- Student Accommodation: Investing in properties near universities can be lucrative due to the consistent demand for student housing. Purpose-built student accommodation or HMOs (houses in multiple occupations) can generate higher rental yields. However, it’s essential to research the specific regulations and requirements for student accommodation in the area before investing.
- Property Development: Engaging in property development projects can be profitable, especially in areas with a demand for new housing or commercial space. This strategy requires careful research, planning, and understanding local regulations and market dynamics.
Where is the best value for money in property UK?
Regions/areas with the best value for money in the UK property market can vary depending on location, market conditions, and personal preferences.
However, here are four areas that have been recognised for offering good value:
- Northern England: Cities like Manchester, Liverpool, and Newcastle have recently experienced significant growth and regeneration. They offer a lower living cost than London and the Southeast, with relatively affordable property prices and attractive rental yields.
- Midlands: Cities such as Birmingham, Nottingham, and Leicester are known for their strong economies, investment opportunities, and affordable property prices. These locations offer a balance between affordability and potential capital growth.
- Wales: Areas in Wales, such as Cardiff and Swansea, have shown promising growth and offer relatively affordable property prices compared to some other parts of the UK. The Welsh government’s initiatives to attract investment and develop infrastructure have contributed to the property market’s appeal.
- Scotland: Cities like Glasgow and Edinburgh have consistently grown in the property market. They offer a blend of affordability, strong rental demand, and potential for capital appreciation.
It’s important to note that the property market is subject to fluctuations, and thorough research specific to your investment goals is essential. Factors such as local market conditions, rental demand, infrastructure development, and future growth prospects should be considered when determining the best value for money in the UK property market. Consult with property investment experts to help you make informed decisions.
Is buying property in the UK a good investment?
Yes, buying property in the UK can be a good investment for several reasons, as outlined below:
- Potential for Appreciation: Historically, property prices in the UK have shown long-term growth. Depending on market conditions, location, and other factors, property values can appreciate over time, providing potential capital gains.
- Rental Income: Investing in rental properties can generate a steady income stream through rental payments. Demand for rental properties remains strong in many areas of the UK, particularly in cities and university towns, providing an opportunity for rental income.
- Diversification: Property investment can offer diversification to a portfolio. Real estate is considered a tangible asset, and its value isn’t directly linked to the performance of stock markets or other financial assets, potentially providing stability.
It’s essential to conduct thorough research, consider market conditions, and carefully assess the potential risks and rewards before making investment decisions. Property investment requires financial planning, ongoing management, and an understanding of local market dynamics — partner with property experts to help you navigate the complexities of property investment in the UK.
Conclusion
As an investor looking for an opportunity in a dynamic market, the UK property sector offers exciting potential. With various locations primed for strong capital growth and solid rental returns, the time to act is now. As industry insiders, we’ve identified several areas expected to outperform in the coming years.
Following our recommendations on the best places to invest in property in the UK gives a competitive advantage when navigating the UK market. Success comes to those who seize the moment, so start your search today and build a portfolio for a prosperous tomorrow. The future is yours to shape; contact us to assist you.
