Investing in off-plan property is a popular strategy to maximise potential returns, and buyers have been flocking to the North West as the new epicentre for investment.
A new index released by Hamptons has revealed a marked shift in investor interest towards the North West of England when it comes to off-plan property, with 63% of all new-build flats in the region being sold off-plan in 2024.
This is the first time any UK region has overtaken London in off-plan property sales since 2007, says Hamptons, demonstrating a shift towards strategic investment in locations offering higher returns overall. In the capital, 55% of new-build sales were made before construction completion, pushing it down to second position overall.
The North West’s property investment landscape has surpassed the rest of the country across multiple factors in recent years, with Manchester recording the strongest house price growth while the city also recorded the biggest jump in sales earlier this month.
Salford was the strongest performer for off-plan property investment, with the figures showing a huge 80% of all new-build flats sold last year were off-plan. Liverpool, which is undergoing plenty of regeneration at the moment boosting the potential for investing off-plan, followed closely behind with 75% of the share.
As the report points out, the trends indicate the strong appeal of “northern urban centres” for property investors seeking the most enticing long-term prospects in the current market.
Why invest in off-plan property?
One of the major benefits of investing in off-plan property is its potential to see greater capital appreciation than a finished property. This is because developers offer lower than market value prices on homes that haven’t yet been constructed, meaning greater scope for a value increase once the project is finished.
This is one of the reasons why northern regions are increasingly surpassing the south when it comes to property investment, particularly in off-plan. Investors looking to secure properties at today’s prices for developments that may not complete for many months or even some years, are likely to concentrate on locations with the best prospects for value growth.
Meanwhile, London’s more sluggish growth may mean that buyers do not reap the rewards of their investment until a later point, which can make the location less appealing.
Alongside lower entry costs, another draw for off-plan property investors is the benefits that come with buying a new-build. This is particularly prominent in the current market as buyers and tenants alike are focusing more than ever on energy efficiency and sustainability. New-builds also offer a higher standard of living in general, meaning they can command higher rents.
Another perk is the fact that off-plan property investors who get in early can select the best unit in a development, or may even be able to secure a further discount by purchasing multiple units in the same block.
Resilient property market
Separate figures have revealed that more than half of property investors plan to expand their portfolios in 2025, with 80% expecting the value of their existing portfolio to rise.
A more strategic investment approach is also being seen within the market, whether that be more diversification in terms of location to secure the best returns, or branching out into different property types as well as residential.
Buy-to-let landlords continue to achieve strong rental returns across the country, with yields hitting a new 14-year high this month. Top rental yields continue to be found in the northern parts of the country, which is another reason why investors are increasingly targeting the UK’s northern towns and cities.
Knight Frank recently revised its UK housing market forecasts to reflect a more positive outlook. It now expects property prices to rise by a cumulative 22.8% over the next five years, up from the 19.3% that was predicted at the end of last year.
If you’re looking for an off-plan property investment in one of the UK’s top-performing towns and cities, get in touch with BuyAssociation today.
