Demand: Popular Area for Young Professionals
Young professionals are a favourite type of tenant for many landlords.
They are often more reliable and tidier occupants than students. There are a number of strategies that rely on them from using HMOs to house medical staff near hospitals or flats in industrial town centres for office workers. Young professionals will also attract businesses that rely on them as customers and employees. This then leads to price upturns in these areas. This allows us to use young professionals for both income and capital strategies. The great thing about these strategies is that they tend to live in the same areas and so investing in these neighbourhoods creates a hotspot for these kinds of tenants. So, now we know this strategy can work, we need to know where there is demand and where these hotspots are popping up. Thankfully ‘The Telegraph’ has given us a head start. They published a list of a few areas popular with young professional buyers. Although the purpose of their article is different, we can use it to work out where demand for housing is high.
1.Surrey Docks, London – Normally we would avoid London as high prices mean they are less viable however, if you are still looking to invest in London then there is some demand in the Surrey Docks. Areas like Clapham and Islington have become too expensive for many young people so many are looking south of the river where around 1 in 10 homes being sold are to this demographic. The demand here is strong as living is cheaper, commuting is still easy and there are plenty of nice waterfront homes.
2.Heaton, Newcastle – This area is historically a student area but has seen an influx of young professionals as it is the cheapest area that is still very close to the city centre. It is seen as an up and coming area shown by the 19% property price growth in the last 5 years.
3.Piccadilly, Manchester – Prices in this area have seen a massive increase in recent years; 14% in the last 2 years and 43% in the last 5. Piccadilly is the place to be in Manchester currently. It famously has a train station but also has bars, parks, restaurants and shops. This area is in the northern quarter near the canal and features all sorts of property including flats and houses.
4.Kirkstall, Leeds – Located North-West of the city centre, Kirkstall, has recently got its own station and shopping centre. This new infrastructure paired with some major residential development means that Kirkstall is really on the up. This one is different from the other options as it is slightly more suburban so generally attracts older occupants. The price increase here had been 7% in the last 2 years.
5.Leith Walk, Edinburgh – In recent years Leith Walk has seen an influx of restaurants and shops. Recent news has detailed plans to extend the tram from the city centre, but Leith is only a 20-minute walk anyway. This turnaround has seen the biggest recent increase of all of our locations with 21%.
6.Bargate, Southampton – Located near the city’s docks this area is very close to the city centre. Over the last decade, a marina with restaurants and bars has been built. This has led to a 33% price increase in 5 years. This area’s property is largely made up of flats so there may be less opportunity to change them, but may be good for leasehold strategies.
7.Hotwells and Harbourside, Bristol – We have spoken about the influx of young professionals into Bristol before, this is due to the rise of large offices into the centre of the city. Hotwells and Harbourside is still very close to the centre for commuters while still being relatively cheap for the city. The prices have increased 11% in the past two years and 47% in the last 5.
8.Nelson, Norwich – This area of the city is regarded as one of the nicest areas in the city and it is still affordable. It features independent shops, tree-lined streets and period housing making them very popular. There has only been a 5% increase in the last 5 years but demand is very high and many of the older properties have the potential to be refurbished.
9.Harborne, Birmingham – We’ve left one of the best for last as Harborne is situated next to two of Birmingham’s biggest employers, the Queen Elizabeth Hospital and the University of Birmingham (you can also target students). The houses here are also period or at least older so have potential to change. There are also many restaurants and bars popping up increasing its popularity and showing that the area is up and coming. The area has seen a 7% increase over the last year.
Hopefully this list gives you some inspiration of where to find demand for young professional housing. If you would like to learn how to use this demand and get the best out of property then come along to one of our FREE Seminars.