City Centres or Suburbs: Which is the Best Property Investment?

City Centres

It is no secret that the cost of living and properties with it are generally pricier than the city’s outskirts. However, this is for their thriving activity and constant improvements, building a strong economy and creating fantastic capital growth opportunities. This reason alone can make city centres the best property investment.

People are no longer migrating for open, green spaces. Instead, they are returning to their pre-pandemic desires for the convenience of closer amenities. These pre- and post-COVID desires are both being catered to, though. Through larger regeneration projects, the likes of leisure, green space, connectivity, and workspace are heightening appeal. This is recently seen in Leeds’ Aire Park project, building a development dedicated to accommodation, offices, and retail – all while connecting it to the heart of the city. Also, incorporating green space in developments like these hopes to improve the air quality and well-being of residents and visitors.

Because of the ever-growing economy of city centres, they can often offer the best property investments. Cities in the Northern Powerhouse are seeing large businesses relocate there. The likes of Channel 4, BT, and Asda saw the capital growth potential in Leeds to base their headquarters there instead of London, and the city’s economy has boomed because of it. Growing business sectors, whether start-ups or industry giants, massively increase a city’s desirability and rental demand for relocating working professionals. This is similarly seen in Manchester with its thriving Media City. Young professionals from across the country move to make the most of new digital hot spots in the Northern Powerhouse. Other Northern cities are following suit, with the likes of Liverpool, Leeds, and Hull strengthening their business sector by creating high-quality and desirable office spaces. The North, too, remains resilient throughout the current interest rates.

City Towns and Suburbs

Investors may first see areas away from city centres as bad investments, but this could not be further from the case. Suburban towns can often be as convenient and beneficial as city centre living. Most individuals look to the city outskirts for its affordability. For example, Manchester sees rent average at £1,409pcm in the city centre, which has encouraged 54% of tenants to move to Manchester’s suburban towns. With public transport and ring roads offering quick commutes into the city centres, heading further out for more affordable accommodation is an obvious choice for tenants.

When buying or renting in suburban towns, individuals can often guarantee properties with more space for less money compared to city centre alternatives. What is more, with larger cities improving their local connectivity, residents can never be more than 20 minutes away from the heart of the city. These locations are perfect for students, who prefer more affordable accommodation a reasonable distance away from the universities and the city’s nightlife.

Location is key and, while often easily commutable to the other side of cities, looking at nearby amenities is key. Areas near sports stadiums, retail parks, and hospitals can greatly increase the local economy. These areas can be where the demand lies, whether for short-term lets or long-term residency. Lower property prices and high demand mean increased rental income, making the city outskirts home the best property investment.