Recent reports from Hometrack and Zoopla have found that Glasgow and Manchester are the two best cities when it comes to property investment.
Out of a possible 30, both cities scored 28 points – based on metrics comprising rental yield, annual property value percentage increase and transport links.
Why are Investors Turning to Property?
According to rw-invest.com, UK property investment has remained resilient in spite of the recent economic turbulence and is one of the most lucrative and accessible investment opportunities, with certain regions like the North West expected to see property price growth of almost 11.7% in certain areas.
With this in mind, it’s understandable why Manchester has also taken the top spot in these reports, receiving high marks across all three metrics.
Whilst the rental yield for Manchester was noted as being slightly lower than Glasgow, at a rate of 5.1%, the property market in the city continues to dominate the market in terms of demand and population.
Glasgow & Manchester: The Top Choices?
Coming out on top with rental yield, Glasgow scored a perfect score, with the latest data showing an average yield of 6.8%.
The Scottish port city also performed well in terms of growth, with it seeing an increase of 14.1% in the last twelve months.
As of 2021, Manchester was the most densely populated of the North West’s 39 local authority areas, with around 34 people living on a football pitch-sized area of land. For context, there are approximately three people for every football pitch-sized piece of land in England. Today, there are about 2,791,005 people living in Manchester, according to World Population Review, and it is one of the most visited cities in the country by foreigners after London and Edinburgh.
Alongside this, Manchester is Europe’s second-largest cluster of media businesses, the bulk of which is centred around MediaCityUK in Salford Quays, home to Media City – home to the likes of the BBC and ITV. The city also has two premiership football teams, all of which understandably increase attractiveness for investors.
What Other Cities Should Investors Look Out For?
The rest of the top 5 cities on the list were Sheffield, Bristol, and Edinburgh, with rental yields ranging from 5-8% and annual property growth between 7% and 8%.
Birmingham and Nottingham came next, both receiving a total score of 19. Performing well in terms of rental yields, 6% and 8%, the two also offer relatively affordable prices and solid potential for further growth.
However, while they scored slightly lower than the other cities on the list in terms of transport, Birmingham and Nottingham are in the midst of significant regeneration schemes, which are expected to boost tenant and worker demand in the coming years.
Rounding out the list, Liverpool, Cardiff and Leeds scored 18, 17, and 16, respectively.
When it comes to rental yield and transport links, Liverpool was the clear winner, boasting a yield of 9% and annual growth of 2% on the year. The maritime city is also one of the most reasonably priced on the list, especially when also considering its yield, and could be a compelling option for those seeking long-term growth potential.
