The property market in the North West region’s major cities shows no signs of being dulled by the overshadowing cloud of Brexit which is bringing much reported doom, gloom and uncertainty to the UK’s property market. London, however, is feeling the effects of the uncertainty generated by the protracted Brexit negotiations, with house price growth slowing to just 1% (Source: Zoopla).
Figures posted for the North West paint a more positive outlook for the UK’s housing market, something which is not so widely reported in the often London-centric mainstream media. Since the 2016 referendum result, Manchester has posted a 15% increase in values to date, with Leeds and Liverpool posting 12% and 11% increases respectively over the same period (Source: Zoopla). This trend looks to be continuing according to the RICS’ latest UK Residential Market Survey which highlighted positive indicators for the month of February. There has been an increase in both sales and enquiries during February, whilst the supply of new stock to the market also increased on previous months’ figures
. Whilst undoubtedly there is uncertainty hanging over the UK market, all signs are pointing savvy investors to the North West’s major cities where there is considerable value to be had in terms of both pricing and rental yields. Shawbrook Bank recently undertook a study which indicated that rental properties in the North West are on average offering a 5.4% rental return, compared to London where the average return registered at 3.9%.
The same report states that the average price of a buy-to let property in the North West was £152,406, whilst in London the average value was £478,475. It’s easy to see why investor focus is switching away from the capital to the North West’s major cities.
No city offers investors the chance to capitalise on the above more so than Liverpool. The city was recently highlighted as the UK’s premium buy-to-let location, with a report by TotallyMoney ranking three Liverpool postcodes within the top 10 locations for buy-to-let yields in the UK.
House price values in the city grew by 7.5% in the annual period ending September 2018. The factors attributed to this are the extensive investment and regeneration projects around the city and the fact that prices in Liverpool still remain lower than 2007 pre-crash values. These combined factors provide immense capital growth potential for the city, whilst also allowing investors to take advantage of strong rental yields.
Projects such as The Tannery, located in the heart of the Pumpfields regeneration project, are offering “capital quality residences” at below market prices, with studios starting from just £85,000. An investment at The Tannery offers a 6% Net assured rental return for 3 years and investors have the choice of a variety of payment plans, all offering interest paid on deposited funds until completion.
Written by Dan Ehret