Liverpool has become a leading buy to let hotspot, with investors from around the world flocking to the city. From new purpose-built student accommodation (PBSA) to renovated warehouse apartments to brand new retail complexes – the city is brimming with opportunities for savvy property investors. But why is Liverpool such a great location for property investment? Here are several reasons why investing in Liverpool property is so lucrative.
Affordable Property Prices
The UK is full of regional variations when it comes to property prices, and the North West is one of the most affordable areas in the country. The UK average house price is now around £217,000 whereas in Liverpool it is just £120,000. In comparison, in London, the average house price rises to almost £500,000. Because of these affordable house prices, Liverpool has been increasingly seen as a great location for property investors, where they can get far more for their money. If you are starting out in property investment, or if you are looking for a lower risk option, then because of the low entry prices, Liverpool property investment could be perfect.
Rising House Prices
Though house prices in Liverpool are considerably more affordable than other areas of the UK, this looks set to change as Liverpool experiences some of the highest property price growth in the country. According to the UK Cities House Price Index, in August 2018 Liverpool had the highest house price growth in the country, with 7.5% house price growth over the last 12 months. The UK average house price growth level was just 3.6%, less than half the Liverpool house price growth rate. There’s a number of reasons for these rising house prices, from major regeneration projects to increased international investment to rising demand. This also looks set to continue over the coming decade.
There is a huge demand for rental property in Liverpool, with an increasing population driving up demand. Liverpool has a huge student population of over 70,000, with many of them choosing to stay in the city after university. This means that the need for rental property for both students and graduates is rising too, providing lucrative investment opportunities. Over the next five years, rents in Liverpool are expected to rise by 17.6%, as under-supply and increased demand lead to better profits for buy to let landlords.
Liverpool really holds its own when it comes to rental yields, and was recently found to be the top buy to let hotspot in the country. In 2018, Liverpool had three of Britain’s top ten buy to let postcodes. The L7 postcode had rental yields of 11.79%, L6 had rental yields of 11.52% and L1 had a 9.36% rental yield. In fact, out of the top 25, there were six Liverpool postcodes on the list, showing Liverpool’s incredibly lucrative buy to let potential. Property investment firms like RW Invest can offer properties with assured rental yields for a certain time too. Rental yields measure how profitable a property investment is, in terms of how much rent is received compared to how much was paid for the property. With such high performing properties available, Liverpool property investment is a strong prospect.