As a property investor, starting or adding to a buy-to-let property portfolio can be a complex task. Making sure you buy the right property in the right location is crucial when it comes to the ultimate goal of generating high and sustainable yields.
Today, property in several of the UK’s biggest cities demand high prices, with several populous areas seeing continued increases in property cost. Despite UK property prices increasing, investors can still find cheap investment property in the North of the UK.
Investing in buy-to-let property can yield large ROI in the short, medium or long term. The UK property market still represents one of the best and safest ways to invest your money.
In fact, buy-to-let property remains the UK’s most popular type of investment. A survey by specialist bank Aldermore recently reported that more than four out of ten UK landlords expect the private rented sector to grow, while 17% are planning on expanding their buy-to-let portfolio.
Should I Buy Cheap Investment Property?
Buying cheap investment property is a great option for investors looking to turn an initial investment into a regular earner, quickly. In addition, buy-to-let still remains one of the most stable ways to make money from a real estate investment.
For example, renting creates a steady monthly income payment, like a classic dividend-paying utility stock. For most buy-to-let investors, buying cheap property in developing areas with high rental demand and growth prospects can generate this monthly income fast, while also generating the highest yields.
Cheap Property Benefits The Rental Market
An alternative option to buy-to-let is ‘flipping a property’. This involves buying a house, renovating it and then selling it on for a greater price than was originally paid. Getting a return on a buy-to-sell investment will depend on several factors – the biggest being the appreciation of a property, and how cheaply you can renovate it.
In recent times, as rises in house prices have started to slow down and level out, and even decrease in some areas, buying a house to sell on quickly is less likely to deliver the same rewards it once would have. As property prices are already generally quite high, less people are buying property in favour of more flexible and cheaper options such as renting. This means that making a significant profit quickly from a buy-to-sell property is much more difficult.
According to the Office for National Statistics
- “average house prices in the UK have increased by 3.9% in the year to April 2018 (down from 4.2% in March 2018). This is its lowest annual rate since March 2017 when it was 3.7%.
- The annual growth rate has slowed since mid-2016 and has remained under 5% throughout 2017 and into 2018.”
The for-sale market for both existing and new-build properties therefore represents a risk for someone hoping to make a quick return on their investment.
Conversely, according to an annual report by estate agency Knight Frank:
- around 5m households, or 21% of the total, currently live in private rented accommodation, a quarter of whom are families with children.
- This is set to rise to 79m (or 24%) over the next five years, alongside 14.3 million owner occupiers and 4.3 million social tenants.
- Households living in privately rented accommodation has reportedly doubled over the last decade
- it is predicted that by 2021 nearly one in four households will be privately renting.
There has never been a greater demand for rental properties in both towns and cities all over the UK. If an investor can spot cheap property opportunities in an area where rental demand is set to increase, they stand a chance of generating some of the best ROI’s in the current market. Furthermore, this is where property owners are able to make the most money back over a longer period of time, turning a cheap buy-to-let into a handy nest egg for the future.
Cheap buy-to-let properties are an emerging opportunity for market savvy buyers hoping to make sustainable gains on their investment. By adding cheaper buy-to-lets to your property portfolio you’ll create the potential for yields across multiple investments too.
From student flats to luxury apartments, Fitzwilliam Capital Partners build and manage with the buy-to-let investor in mind. All our property developments carefully consider local buy-to-let demand, and come with assured rental guarantees, high yields and an option for managed investment.
Secure high buy-to-let yields on investment property with Fitzwilliam Capital Partners. Contact us today to find out how we can assist you in making the right property investment.
Cheap Investment Property In The UK
If you are looking for cheap buy-to-let property, the North represents a great opportunity. Historically, northern house prices have been a lot cheaper than in the South, and while this is still the case, change is on the horizon.
Nowadays, once run-down industrial cities and towns are emerging as ideal places to buy high yielding investment property. In fact, property prices and rental demand are set to dramatically rise in the not too distant future.
Due to government redevelopment, new businesses, job creation and population growth, northern towns are increasingly vibrant and modern places to live. They’re attracting young families and graduates alike, creating a greater demand for rental properties.
Property prices in many Northern cities and towns are still significantly cheaper than UK averages for like-for-like properties. This represents an opportunity for buy-to-let investors hoping to pick up a bargain in areas with developing growth.
Pontefract and Stoke-On-Trent are both fantastic examples of how the North of England is changing. They both offer exciting property investment opportunities for first time buyers and investors.
Cheap investment property in Pontefract
Pontefract looks set to become a key growth area over the next couple of years. Currently, property in Pontefract is significantly undervalued compared to the UK overall. According to property market intelligence company Data Loft, current flat prices in Pontefract are up to 170% less than the UK as a whole, at an average price of £79.5k.
For property investors this presents a unique opportunity to buy a great value home which is set to increase in value. If the purpose of the investment is buy-to-let, the owner can expect to see high yields on their investments.
Pontefract is certainly up and coming. Redevelopments are also set to take place within the next decade, improving on what is already a successful and thriving town. According to the Wakefield.gov.uk website, “The Pontefract Vision 2028 is setting out the organisations’ shared priorities for the historic town, which will help guide development and steer projects into the next decade and beyond.”
Cheap Investment property in Stoke on Trent
As a city currently experiencing a rise in entrepreneurialism, Stoke-on-Trent is firmly on the map when it comes to business growth in the UK.
In fact, Stoke on Trent is one of the highest performing cities for rental yields in the UK.Property Partner’s study ranked Britain’s 100 major towns and cities, taking into account the average income, average property price and average rent in each area. Stoke on Trent featured in both the top ten yielding towns/cities and the ten best places to become a landlord overall.
On top of this, the city’s popular and growing university welcomes thousands of new faces every year, providing a constant source of rental demand.
In addition, Stoke-on-Trent is also set to benefit from key redevelopment in coming years. The train station will be completely redeveloped, while new hotels and accommodation will also be built to help service the growing tourist and student markets.
Property Investment with Fitzwilliam Capital Partners
At Fitzwilliam Capital Partners we can help you get the most out of your investment property. Not only are we. We are fully up to date with the buy-to-let market, but we’re constantly going above and beyond to develop properties that deliver outstanding yields for both us and our investors.
So, whether you’re an experienced investor who’s looking to add to your portfolio or looking for your first investment, our knowledgeable team can help you find the ideal property at the right price.
Get the most out of your property purchase. Contact us today to learn about how we can help you find an exciting investment property in the UK.