With the most recent figures showing there were 2.74 million landlords in the UK at the end of 2022, the thriving UK rental market poses an exciting opportunity to maximise the buy-to-let property market – but some locations are hotter than others. Residential lettings provider SevenLiving, the property management platform by SevenCapital Group, delves into the top five UK rental hotspots for landlords in 2023.
1. Birmingham
- Average property price: £278,496
- Average rental price: £1,679 pcm
- Average rental yield: 7.23%
As the UK’s largest second city with a total of 1.1 million residents, the population of Birmingham is set to rise to 1.24 million in 2023.
Home to major players including Deutsche Bank, HSBC and KPMG, Birmingham is a globally recognised financial and professional services hub with over 86,000 financial and professional service jobs contributing to the £3.7 billion exported by the region is financial and insurance services.
One of the youngest cities in Europe, with around 60% of the population under 35 years of age, Birmingham boasts over 100,000 students attending five universities throughout the city with an average retention rate of 46% – offering significant potential for landlords to accommodate young professionals.
2. Leeds
- Average property price: £257,819
- Average rental price: £1,623 pcm
- Average rental yield: 7.55%
The third largest city in the UK with an estimated population of 757,000, Leeds’ booming economy as a leader in the banking and professional services industry offers many high earning jobs for local residents and commuters alike.
With five higher education venues across the city, Leeds has a thriving student population with the largest, the University of Leeds, welcoming over 33,000 students each year. With almost thirty per cent of all the city’s graduates staying in the city post-graduation helping to add to the city’s growing workforce, there is high demand for rental properties in the city.
Leeds is also a popular tourist destination, thanks to its rich history, diverse culture and vibrant nightlife which attracts over 29 million visitors annually from both the UK and abroad – providing a fruitful opportunity for landlords looking for their next buy-to-let property location.
3. Slough
- Average property price: £438,305
- Average rental price: £1,946 pcm
- Average rental yield: 5.32%
The launch of the Elizabeth Line just 12 months ago put this Berkshire town solidly on the map. An established London commuter town, Slough offers affordable rental properties compared to the Capital – now under 15 minutes away by train, with around 60,000 people commuting in and out every day.
The Slough property market continues to be one of the most affordable in the south east, with forecasts from Savills showing that prime capital values across the south are anticipated to have a 11.6% five-year compound growth between 2023 and 2027 – posing a great opportunity for landlords to invest in the Slough property market.
With relatively low levels of rental supply, unrivalled transport connections, and outstanding employment opportunities with more company HQs than anywhere outside London, Slough continues to prove its credentials as one of the best places for landlords to invest in 2023.
4. Nottingham
- Average property price: £256,318
- Average rental price: £1,260 pcm
- Average rental yield: 5.89%
With a population of over 323,700 and 77% of the UK’s population living within one hour of Nottingham with nearby access to the M1 and A1, the city has earned its reputation as one of the most accessible cities in the country.
Overflowing with culture and history, Nottingham features a thriving shopping hub, enviable art scene and roaring retail and leisure sector continue to draw people to the city. Through extension regeneration, multiple areas of the city have become flourishing cultural hotspots – including the former Lace Markets in Hockley which now features bars, restaurants, offices and more.
The long let rental market in Nottingham is thriving, with Track Capital’s 2023 report ranking the city 7th out of all the towns and cities in the UK in terms of rental yield, well above the East Midlands average of 4.1%.
Its excellent growth potential, unrivalled location and attractive rental yields, coupled with its sustainable student population with full time university students comprising one in seven of the population, Nottingham has a lot of potential for buy-to-let investors.
5. Bracknell
- Average property price: £423,901
- Average rental price: £2,926 pcm
- Average rental yield: 8.28%
With a booming population which is anticipated to reach 141,000 by 2039, Bracknell’s growing popularity can largely be attributed to its fast commutability to London and its ongoing £770 million town centre regeneration scheme which continues to attract residents and visitors alike.
The redevelopment of the Lexicon Shopping Centre has seen an uplift in the number of visitors to the area, with over 70 shops and restaurants drawing in traffic, whilst the local area’s abundance of 150 parks and green spaces are ideal for those who love the great outdoors.
With an employment rate of 97.3%, Bracknell has become a key destination for the UK’s growing technology sector. Its position within the UK’s Silicon Valley offers an abundance of job opportunities and is home to over 27 major tech companies – the highest concentration outside London which generates over £5.5 billion for the local economy.
Boating the current highest average rental yield of the five hotspots identified, and with future urban regeneration in the pipeline, rental properties in Bracknell offer a fantastic opportunity for landlords to capitalise on its growing appeal in 2023.
SevenLiving is a full service property management company operating across the UK. For more information on letting your property through SevenLiving, please visit www.sevenliving.com