Northern England: The Prime Investment Destination 'For the Foreseeable Future

2 mins
October 17, 2023

Explore the North's impressive growth in property values and investment opportunities.

Property Investment and Buy-to-Let Analysis: Evaluating the North vs. South Divide

In the realm of property investment and buy-to-let, England has long been characterised by a North-South divide. However, recent data analysis by Sourced Franchise reveals an intriguing shift in the landscape, one that could significantly impact the investment choices of discerning individuals.

Geographical Segmentation of England: North vs. South

The Northern region encompasses the North West, North East, West Midlands, East Midlands, and Yorkshire & Humber. The southern region consists of the South East, South West, London, and the East of England.

Capital Appreciation Trends: The North's Ascendancy in Property Investment

In the North, the average house price surged from £205,875 in May 2022 to £211,392 in May 2023, representing a substantial 2.7% increase. In the South, however, the price rose modestly from £385,719 to £388,917, a 0.8% uptick. It's worth noting that the top-performing regions over the past year were all located in the North. The North East led with a formidable 4% growth rate, followed closely by the East Midlands (3.4%), North West (2.7%), and West Midlands (2.2%). In contrast, the South East lagged behind with a 1.5% increase.

Balancing the Scales: Rental Values in the North and South

Yet, the North-South divide becomes less clear when we scrutinise changing rent values over the same period. In the North, the average rent value witnessed a commendable 8.7% rise, climbing from £759 per month to £824. Meanwhile, the South registered an even more impressive increase, with rent values surging by 9.5%, from £1,255 per month to £1,374. The cities that stood out as rental value champions included London (12.5%), the West Midlands (10.8%), South East (9.7%), North West (9.5%), and East of England (8.9%), creating a balanced performance scale between the North and the South.

Yielding Success: The North Dominates Average Yields

Notably, when we delve into the current average yields, the North once again emerges as the frontrunner. Across the North, the average yield stands at a robust 4.7%, whereas the South reports a slightly lower yield of 4.2%. On a regional breakdown, the North outperforms the South yet again. North West shines with the highest yield at an impressive 5.5%, followed closely by Yorkshire & Humber at 4.9%. London, North East, and the West Midlands contribute to this remarkable performance with yields of 4.7% and 4.4%, respectively.

Expert Insight: The North's Ascendance in Buy-to-Let and Property Investment

Sourced Franchise's director, Chris Kirkwood, offers his expert perspective, stating, "For a significant period, we have witnessed the North-South housing market disparity. Historically, the narrative painted a picture of a thriving South and a struggling North. Nevertheless, our latest in-depth analysis underscores a different narrative. The North is now exhibiting a robust performance on multiple fronts, steering the direction of positive growth. Property investors, in particular, should pay close attention. The North offers not only affordable property prices but also substantial returns. This transformation is largely driven by a shift in national focus from London to dynamic cities such as Birmingham, Manchester, Liverpool, and Newcastle. Prominent businesses are relocating from the capital, and families are seeking refuge from soaring South prices in the more accessible Northern markets. We anticipate this trend of Northern dominance to persist in the foreseeable future."

A Dynamic Landscape for Buy-to-Let and Property Investment in Manchester and Liverpool?

In conclusion, the North vs. South property investment landscape is anything but straightforward. The North is seizing the opportunity, offering enhanced prospects and spearheading a surge in growth. For those interested in buy-to-let and property investment, keeping a close watch on the developments in Manchester and Liverpool, among other dynamic cities, may yield fruitful opportunities in the years to come.

Manchester Leasehold Buy-to-Let Property Investments
Liverpool Leasehold Buy-to-Let Property Investments

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