Whether you’re a novice landlord or a seasoned professional, finding the right location for your buy-to-let investment is crucial.
Mortgage lender Aldermore has analyzed the places in Britain that score highly on five key indicators of buy-to-let desirability, to help landlords make the right location choice.
It looked at the average total rental price, the best short-term return through returns, the long-term return through the increase in house prices over the past ten years, the lowest number of vacancies as a percentage of the total housing stock, and the percentage of the city’s population in the last ten years. the rental market.
Taking all this into account, the best city for buy-to-let emerged as Bristol. This was followed by Manchester and then Coventry in third place.
Glasgow was the first Scottish city to enter the top 10 since the tracker was launched five years ago. And there were even more newcomers – Brighton (4e place), Portsmouth (7th) and Basildon (9th) jump up to secure first place.
Aldermore’s buy-to-let city tracker – Top 10 (Source: Aldermore Bank)
| Ranking | 2023 | +/-change | Ranking 2022 | Ranking 2021 |
| 1 | Bristol | +2 | Manchester | Bristol |
| 2 | Manchester | -1 | London | Oxford |
| 3 | Coventry | +7 | Bristol | Cambridge |
| 4 | Brighton | +10 | Cambridge | Manchester |
| 5 | London | -3 | Peterborough | Luton |
| 6 | Cambridge | -2 | Milton Keynes | London |
| 7 | Portsmouth | +16 | Luton | Noordampton |
| 8 | Glasgow | +9 | Reading | Brighton |
| 9 | Basildon | +3 | Zuideinde | Reading |
| 10 | Milton Keynes | -4 | Coventry | Norwich |
What does Bristol have to offer?
According to Aldermore, Bristol offered the best all-round investment for buy-to-let investors. It has good rental prospects, a large number of long-term private tenants available and a low number of vacant properties at present.
Yield growth was also an attractive lure for landlords, with an annual increase of 6.6%. However, investing in Bristol is not suitable for those looking to invest quickly, with short-term returns of 4.4%.
Increase in rental prices and tenant demand
The tracker also showed how quickly rents had risen. The City Index Tracker showed that in 2021 the average room rent was £423, while in 2022 this was £432 and rose to £455 this year.
Research from Aldermore found that nine in ten landlords (94%) had increased the rent they charged in the last 12 months. With the current situation in the rental market, the research also shows that just under three quarters (73%) of landlords have seen an increase in tenant demand for their properties over the past year.
Jon Cooper, head of mortgages at Aldermore, said: “Landlords have had an unprecedented year with rising interest rates and rising inflation as they navigated changes in property law.
“Yet the demand for rental properties has never been greater. Landlords play an important role in the British economy and provide homes to people who have not yet entered the housing market or do not want to rent.
“Normally a few regions dominate the lead, but this year is the first time we’re seeing a wider range of areas make the top 10.
“We see that each region is made up of multiple smaller markets with their own unique circumstances and challenges. Landlords continue to do their research and work with their agents to assess their portfolios and ensure they get the best value for their properties, no matter what obstacles they face.”