- September 11, 2023
- Posted by: pr_finance
- Category: Investment
Regarding property investment, success hinges on the right ingredients – reliable transport links, amenities, job opportunities, rental demand, and affordability. Timing is crucial, too; getting in early can mean the difference between a lucrative investment and missed opportunities. This comprehensive guide unveils the best places to invest in UK property in 2023, helping you navigate the ever-evolving property market.
Understanding Property Portfolios
What is a Property Portfolio?
A property portfolio is a collection of residential, commercial, and industrial properties owned by individuals, groups, or companies. The primary goal is to generate long-term passive income through rentals or capital appreciation upon sale. A well-managed portfolio offers steady income, fostering wealth over time. While a single property can provide income, diversification with multiple properties enhances cash flow and the potential for early retirement.
SURE THINGS: The ones we’re feeling confident about
Previously labelled an “up-and-comer,” Derby saw property prices soar by 9% in 2022. Boasting high employment rates, bolstered by companies like Rolls Royce and Bombardier, Derby ranks among the UK’s top ten cities for average wages. Despite these impressive numbers, property prices remain affordable, presenting substantial growth potential. An undersupply of new properties further fuels investment prospects, making Derby a promising choice for 2023.
Nottingham, located nearby, sustained its top position on our list. With a remarkable 10.9% price growth in 2022, Nottingham shows no signs of slowing down. Limited supply, increasing demand, and attractive rental yields solidify its status as a long-term investment hub. Despite these advantages, average house prices in Nottingham, currently at £198,000, remain competitive compared to other cities.
Leeds, a consistent performer, secures its place on the hotspots list. While it may not boast the excitement of other locations, its steady performance and substantial ongoing investment make it a dependable choice. Leeds enjoys robust economic activity, housing numerous financial companies and headquarters. Excellent infrastructure, employment opportunities, and renowned universities further underscore its investment appeal.
Manchester & Greater Manchester
Manchester, particularly its city centre, has experienced a property supply surge, outpaced by rising demand, fueling a vibrant rental market. Low availability, as seen with just 360 properties for rent in Q3 2022, has driven a 20% increase in average rents, with some areas witnessing a staggering 38% rise. Manchester’s transformation into a super city, drawing talent from across the UK, cements its status as an exciting investment destination.
Greater Manchester, offering similar growth potential, enables diverse investment strategies, price points, and tenant types. Leveraging the city’s economic strength while benefiting from favourable transport links, investing in Greater Manchester provides a distinct opportunity within the property market.
Liverpool, especially its city centre, maintains its presence on our list. Offering affordability, robust infrastructure, substantial investments, and excellent universities, the city holds significant potential. However, investors should exercise caution outside the city centre, where unfinished developments have posed challenges. Staying within the city’s core can be a safer bet for 2023.
UP AND COMERS: The ones on their way to great things
Newcastle ascends to our list as an up-and-comer. While historically hindered by low rental yields, the city shows promise as institutional investors recognize its potential. The average property price stands at £147,000, accompanied by average rents of £961 per month. Rising rents and notable institutional interest make Newcastle an intriguing choice for those willing to seize the opportunity.
Belfast remains a compelling option with a solid 8% price growth in 2022. Property prices, still 22% lower than their 2008 peak, offer room for growth. Despite the strong fundamentals, investors should exercise caution, given the number of unfinished developments. A prudent approach within the city centre can yield favourable results.
A newcomer for 2023, Cardiff registered mid-table performance in Hometrack’s UK cities house price index. Continuous development, expanding job opportunities, and a growing population make Cardiff attractive. Legal & General’s £1 billion investment in build-to-rent projects underscores the city’s potential. Cardiff offers diverse investment strategies, tenant types, and price points while tapping into the city’s economic strength.
FOR THE BRAVE: The ones we’re keeping a close eye on
Despite possessing robust fundamentals, London ranks lower due to anticipated performance than other areas. While London remains an economic powerhouse, areas such as Derby, Nottingham, and Manchester are expected to outpace it in price growth. However, London’s long-standing subdued property prices compared to the rest of the UK make it an intriguing prospect.
Glasgow, a new entry for 2023, features strong property investment potential, marked by rising prices and rents. However, political factors, including rent freezes and eviction bans imposed by the Scottish government, introduce added risk for landlords. Those comfortable with political risk may find Glasgow an enticing investment.
A Note on Our 2023 Property Hotspots
While we recommend these areas based on thorough research and our investment focus, conducting your due diligence remains essential. Consider taking property investment courses to spot emerging hotspots. If you need help with solo investment, partnering with a property investment company may provide guidance. However, always research and verify any company before collaboration.
In the dynamic landscape of property investment, timing, research, and informed decisions are your most valuable allies. Choose your investment destination wisely, aligning it with your financial goals and risk tolerance.
Investment success requires knowledge, preparation, and the courage to act. Whether you opt for a sure thing, an up-and-comer, or a choice for the brave, the UK property market offers ample opportunities in 2023.
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