Join CityClub Today to Receive:

  • Priority access to exclusive off market investments
  • Below market value pricing
  • Out of hours investor support chat
  • Allocated solicitor for hands free conveyancing

    Lower Price Points 

    Up-and-coming areas often have lower living costs and more affordable housing prices initially. Look for areas where housing and living costs are still below the national average. These areas will be great places for first-time buyers to look to invest to start their portfolio. The starting price for houses in this area will be more reachable for the average person, as the deposit required will be lower than a property in a well-established city. For example, the average person cannot afford to invest in London. However, they probably could in cities such as Hull and Wakefield. With lower house prices, not only will you see strong returns but will be less exposed financially, reducing the risk of loss. 

    Furthermore, these areas have more room for prices to increase as demand rises. Many people looking for homes look for smaller cities outside of other major cities if they’re working professionals or students. This is because they have access to lower-priced housing but will only have a short commutable journey away from where they need to travel for work or education. 

    Amazing Returns

    Higher Rental Yields

    Investors in young cities benefit from attractive rental yields. When investing in property in younger cities investors can expect around 8% yields. This is due to the lower cost of purchase but high rental demand. A strong rental yield is good for cash flow and ensures the property is unlikely to become a financial burden after all costs involved with owning it. Investment property in larger cities may provide investors with very little if no passive income after all costs are deducted from owning the property.

    Capital Growth Potential

    As properties that are not yet above average prices, there will be a lot of room for the property to increase in value, without being unaffordable. So the demand will rise with the property price as tenants looking for rental properties will still be able to afford the prices. A young city is also likely to experience major regeneration to help the city develop and meet the needs of residents. This gives investors the opportunity to purchase a property for a lower price and let the government do the work to boost the property value. 

    For example, Wakefield is a young city and due to the recent growth from regeneration property prices have increased by a staggering 35.12% over the last 10 years, and they are still below the UK average. This means there’s a high demand from tenants and investors experienced incredible capital growth.

    Attractive to Buyers

    Amenities

    Most cities will have everything a resident needs within the area such as shops, healthcare facilities, schools, and entertainment. This means that unless an individual is looking for something, in particular, to live in close proximity to, tenants will be happy to get a better deal on house prices. 

    However, regeneration is constant across the UK so investors can look for areas with plans for new amenities and entertainment options. New shops, restaurants, parks, and transit systems make an area more desirable. This will surely boost housing demand and trigger price growth. See what new amenities and infrastructure are proposed or under development in the city to be aware of the growth that will occur. 

    Accessibility

    Areas located within a reasonable commute of significant cities and transportation hubs tend to see higher demand. Look for up-and-coming places within an hour of a central metro area. Proximity to transport, like trains and Motorways, also makes an area attractive. Check travel times to surrounding cities and what public transport options currently are available or are in planning to be created.

    Regeneration Initiatives

    There has been a push in recent years to level out the quality of life in many areas of the country through strategic regeneration. There have been large-scale public and private investments in many young cities to help level them up.

    Government initiatives to redevelop and regenerate certain areas through housing, amenities, and infrastructure investment can have a positive effect on house prices. Research whether any major regeneration programs are planned for specific neighbourhoods or areas to see where will experience the most potential growth. Long-term, coordinated efforts to regenerate an area usually attract private investment and new residents, influencing price growth.

    Finding up-and-coming locations with large potential growth relies on expert evaluation of areas based on all of the above factors. Choosing an area with solid fundamentals will help maximise return on investment, by generating rental income, benefiting from price growth, and receiving high demand. Contact CityRise today to speak to an investment consultant about the best areas for investment today.

    Related Articles

    • The Average Buy-to-Let Mortgage Rate Continues to Fall

      The Average Buy-to-Let Mortgage Rate Continues to Fall

      As an investor, it is important to keep up to date with changing rates and offers to ensure the best deal is secured. Currently, the BTL mortgage...

      Learn more
    • Top Reasons to Invest in Property

      Top Reasons to Invest in Property

      One of the main ways to accumulate money is by investing. Property is one of the most popular investment choices for many reasons. Due to the...

      Learn more
    • Reasons to Invest in Huddersfield

      Reasons to Invest in Huddersfield

      Huddersfield is a rising town for buy-to-let investment, with the average property prices being more affordable and many selling points to tenants....

      Learn more
    • Buy-to-Let Opportunities with CityRise

      Buy-to-Let Opportunities with CityRise

        Buy-to-let (BTL) investing is becoming increasingly popular due to the amazing returns investors can see if they invest in the right...

      Learn more

    Explore our Investment Guides

    Take a look
    Explore our Investment Guides
    Chat to us