An analysis by peer-to-peer real estate investment platform easyMoney has identified three cities behind the best property investment returns since interest rates started to rise in late 2021.
easyMoney has analysed average house price growth data* in Britain across 15 major cities between December 2021 and today using the latest available data from May 2024.
The data reveals that: –
• In December 2021, the average house price in Britain was £269,273. Today, the average is £288,120, marking growth of 7%;
• Some major cities where prices have seen impressive growth since late 2021 and have, therefore, become Britain’s property investment hotspots;
• Nowhere is this more true than in Sheffield. In December 2021 its average house price was £192,542. Today it’s £216,934, after growth of 12.7%;
• Bradford has seen price growth of 10.3% to £174,930; and another Yorkshire city, Leeds, scores 10% growth to £231,743.
• Newcastle (9.9%), Leicester (9.5%), Bristol (9.4%), Edinburgh (9.1%), Cardiff (8.8%), Glasgow (8.7%), Nottingham (8.5%), and Liverpool (7.7%) have also seen above average price growth.
But some of the major investment cities have particularly struggled, including London and Manchester, both of which have seen growth of just 2.3%. Brighton has seen growth of 4.5%, while Birmingham prices have risen by 5.4%.
A spokesperson for easyMoney says: “When the Bank of England started increasing interest rates at the end of 2021, it made property purchasing more expensive for the vast majority of people who require the help of a mortgage. This includes property investors of all shapes and sizes. And because buying became more expensive, fewer buyers entered the market and this fall in demand means prices have struggled.
“But as is always the case with the British housing market, even when the national picture shows muted growth, there are always corners and pockets where prices are rising at pace. In the past few years, the best of these pockets appear to have been Yorkshire cities.
“The best, most astute property investors are wise to the fact that when price growth stutters in one city, it will be booming in another, so a smart investor who normally invests in Manchester will have shifted their attention to Sheffield, for example, for the past couple of years.”
