Why the North West?
The North West of England is now the most popular region for buy-to-let investors. The Times recently wrote an article on research done by Savills. The North West takes over from London and the South East as the area of most properties bought using buy-to-let mortgages.
What does this mean exactly?
Firstly, that the potential for higher yield is outside London. The research analyst for Savills agrees, he said ‘this is evidence of landlords switching their focus to higher-yielding markets’. Fielding has been aware of this for some time. Areas like Manchester and Birmingham are popular investment areas for many of our Fielding family. Savills expects the house prices to continue to rise in these areas, by as much as double the national average.
Making it 10.2% per year compared to only 4.5% in London.
Secondly, this shows a trend of professional investors taking over from amateur landlords. A Manchester based estate agent says that buy-to-let landlords largely come from ‘London and the South East’. An example of how professional landlords will do their homework when it comes to finding the best areas to invest and not just in their local areas.
Professionals are taking over from amateurs
These high figures for the North West come after nationally ‘the number of properties bought by mortgaged landlords fell by 11 per cent last year’ due to ‘higher stamp duty costs, loss of tax reliefs’ and stricter ‘lending criteria’. Again, showing that these changes scare off amateurs but can help us as professionals, who do the research, get great returns with property.
Why the North-West? The Times reports that North West towns have seen an influx of young professionals and students (Manchester for example has the highest retention rate for students). This is due to increased employment rates in the areas and a rise in popularity of city centre living. This demand must be followed, as always by supply. Allowing for the previously mentioned, high numbers of property investors to fill the need for housing. Cities like Liverpool and Manchester are doing so well the number of first-time buyers has also increased along with landlords. This is contrasted to London where house prices have led to a reduction of renters and buyers leading to a disparity between supply and demand.
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