Index identifying highest yielding UK postcodes demonstrates the importance of the Scottish and north-west England cities to investors.
- Glasgow and Manchester feature prominently in a new index that measures the UK’s top city postcodes for buy-to-let yields
- Four postcodes in Scotland’s largest city have yields that are significantly higher than the Scottish average, while average returns in Manchester are 2.78% higher than the best performing London borough
- Growing economies in both Glasgow and Manchester mean that investors should head to these regional cities now
UK property investors looking for the strongest returns should head out of London and look to regional cities such as Glasgow and Manchester.
Figures from the latest LendInvest Buy-to-Let Index, a list of the top 20 buy-to-let hotspots in the UK, highlighted both cities, with four Glasgow and two Manchester postcodes among the highest yielding locations in Britain for property investors in January. Other cities also included Sheffield and Liverpool.
In Glasgow, the G2, G51, G21 and G81 postcodes generated returns by as much as 8.90%, 1.10% higher than the national average for Scotland. While in the north-west of England, Manchester’s M13 and M38 postcodes saw gross yields as high as 8.30%.
Scotland’s largest city, Glasgow has one of the fastest rates of job creation in the UK, and the population of the city is set to reach 600,000 by 2018. It’s also benefited from years of sustained economic investment. For example, in August 2014 UK government and local council officials signed ‘The City Deal’ agreement – a pledge to invest more than £1 billion into major infrastructure projects in Glasgow.
In Manchester, average yields are currently 2.78% higher than the best performing London borough of Newham. A sustained increase in visitor numbers and an undersupply of accommodation with short term tenancies have driven demand for rental property in the city.
Manchester is already the largest economic area outside of London, with 80 of the FTSE 100 companies having a presence in the city. But it is also central to the UK government’s Northern Powerhouse plans, meaning Manchester is set to benefit from £7 billion worth of investment over the next few years.