In England, the North West and Yorkshire and the Humber regions continue to stand out with the country’s strongest property markets.
As the UK housing market picks up its pace through the summer months, there is still an evident North-South divide when it comes to house price growth, which continues to impact the property investment outlook regionally.
The more affordable parts of the country not only give you more property per pound, but they’ve also been seeing the fastest house price rises for some time now, and the latest figures show that this trend isn’t going to disappear anytime soon.
In Halifax’s latest house price index, the UK as a whole recorded a 0.4% month-on-month property price rise, with a 2.4% annual increase, bringing the average house price to £298,237. Halifax’s research is based on mortgaged property sales, and therefore does not take into account cash purchases, which might show slightly different results.
But both the North West and Yorkshire and the Humber experienced much stronger price growth of 4% annually, making them the leading regions and keeping them securely on the radars of property investors seeking strong future returns.
Better affordability outlook
Overall, people’s finances have been in a better place than they were a year ago, with strong wage growth and falling mortgage rates opening up avenues to a greater number of buyers, which has helped to keep momentum going in the housing market.
House prices have been buoyed as a result, with the expectation among many analysts being that values will continue to rise over the course of the year, with potentially stronger growth in the coming five years.
Affordability is also a key aspect behind the outperformance of regions like the North West and Yorkshire and the Humber, as well as other locations generally in the North of England, as well strong Midlands cities such as Birmingham.
Despite strong house price rises, these regions are still home to some of the cheaper properties in the country, with average house prices in the North West now being recorded at £242,293 according to Halifax, while in neighbhouring Yorkshire and the Humber the average home costs £227,928 – both of which are well below the national average.
For homebuyers and property investors alike, this makes housing much better value for money, and is a major reason behind much of the outward migration in recent years from more expensive parts of the country – like London and the South East, which have recorded much slower house price growth – into more affordable locations.
Where to invest in the North West and Yorkshire
While the Halifax House Price Index doesn’t focus more closely on town and city performance within each region, other indices such as Rightmove also list property price patterns in the UK’s cities.
Manchester has regularly featured as either the top city or within the top five for several years now for house price growth, outperforming even the wider region. Its strong educational and employment offering coupled with major transport improvements and regeneration make it a favourite among property investors focused on capital growth.
Nearby, Liverpool is also a standout city for investors, and particularly for buy-to-let landlords looking for a strong rental market, as the city regularly comes out top for rental yields.
Leeds, the largest city in Yorkshire, has also outperformed the rest of the region with its resilient and expanding housing market, with more opportunities in the pipeline in the city thanks to extensive regeneration plans.
Sheffield is another strong contender for investors looking for affordable property prices, strong rental demand and excellent returns prospects, and has also recorded higher than average house price growth over recent years.
