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What can Leeds’ property market offer you as a buy-to-let investor?
- Buy-to-let opportunities in the city centre of Leeds generating high returns and strong demand
- Investment property in sectors such as build-to-rent, HMO and short-term let
- Free access to lucrative developer stock in and around Leeds city centre
- Leeds City Region now boasts the second-largest economy after London
- Average gross rental yield of 8.97%, which drastically outranks other cities
- Soaring property prices rising by around 21.5% in the next 5 years
Leeds is a city with a lot to offer. It has a thriving economy and an excellent transport network, as well as being home to some of the best universities in the country. With all these advantages, Leeds property investment can be an exciting opportunity for any buy-to-let investor.
With our extensive knowledge of the local area and the market, we can offer advice on value, location, and other factors that may affect your decision-making process. Whether you are a first-time buyer or an experienced investor, we can help find the perfect property for your needs.
If you’re ready to purchase an investment property in Leeds, browse our investment opportunities to find out more.
Property Investment Leeds: Leading the way for strong rental growth and tenant demand
The growth of the Leeds rental market goes hand in hand with the city experiencing a significant rise in housing stock. This is due to city-wide investment plans that all point to a future active economy. Consequently, these plans are increasing awareness about the rental market among residents. The fact that Leeds is a growing area makes it a good place to invest.
In terms of demographics, renting is at record levels for the younger age groups. For this rental market, apartments are among the most viable investment properties. With this, HMO property investment is proving extremely lucrative in and around city centres, and Leeds excels in this asset class due to its high student and young professional population.
The average Yorkshire rental price has reached £655, up 8.5% since 2021, with Leeds itself experiencing a 9.6% boost as young people have returned to the city following the lifting of Covid travel restrictions. According to Zoopla’s quarterly Rental Market Report, a number of factors contributed to this increase. Because of the increasing demand and endless opportunities that this city presents, rental yields produced from buy-to-let property investments in Leeds outperformed those produced by London’s private rental sector in 2020. Landlords can expect to secure a high yield of 8% in some Leeds city centre postcodes, which is double the figure of the UK’s average. As for the rest of the areas outside of the city centre, landlords can achieve around 4.3% in rental yields.
Average rent across the UK is on track to reaxch almost £1,000pcm, which is £62 more than it was at the start of the pandemic. However, the average rent for residential properties in the city of Leeds sits at around £1,049 as of the start of 2022. Because of this high figure, investors can expect higher rental returns from their Leeds-based buy-to-let investments.
Property prices soaring year upon year makes Leeds a fantastic place for capital growth
It goes without saying that the entirety of the UK is seeing prolific growth in the housing sector, with the leading cities experiencing rapid increases in house prices, rental costs and investment. Leeds, in particular, is amongst one of the dominant cities whose property market is outperforming many other prime UK cities.
In 2021, the average sale price of a standard property in Leeds rose by around £25,000. In fact, it has been projected that house prices in Yorkshire will increase by 21.6% in the next five years, with the demand for city-centre apartments driving both rental and housing costs up year on year.
Build-to-rent property in Leeds attracting high student and young professional population
Leeds is a top student city in the UK and boasts one of the largest student populations in the country. The city has the highest concentration of higher education institutions outside of London – almost 40,000 Leeds-based students graduate each year. Leeds is home to four prominent universities, including the University of Leeds, Leeds Beckett University, Leeds Trinity University, and Leeds Arts University.
Graduates also require housing; it is not just students. Graduating students at Leeds tend to stay in the city after they graduate, with the retention rate currently sitting at around 30%. As a result, the rental market remains solid outside of the academic year. Graduates tend to fall under the bracket of most desirable tenant types, as young professionals seek high-quality housing at an affordable price. In fact, one in four landlords claim to prefer housing this tenant type due to their long-term commitment to their careers and rental property.
Student investment property covers a large blanket of asset classes, including HMO property and the growing build-to-rent model.
One of the UK’s most successful business hubs
Leeds’ stable employment base and diverse sectors play an integral role in its appeal to investors and young professionals. Currently, there are around 126,000 companies based in the Leeds city region, with this number forecasted to increase in the coming years. Moreover, employment is predicted to rise by an average of 6.5% over the next 10 years. This is an extraordinarily high increase in comparison to most other prime cities in the UK.
Leeds is home to a plethora of sectors, including retail, leisure, construction and manufacturing. The digital industry, in particular, is a fast-emerging sector in the Leeds city region and has so far employed over 100,000 individuals. The opportunities that continue to arise in the digital space suggest that more and more talented people will choose to relocate to Leeds and contribute to the strong demand for housing. The dominating sectors in Leeds, however, are financial and business services, which accounts for 38% of the total output.
Large-scale regeneration work and the rapidly growing economy are what continue to attract such big players to base their headquarters in this area. Some big names include the likes of Asda, Jet2, NHS England and Tetley’s Brewery. It is with thanks to these triumphant businesses that more young people opt to study, work and live in Leeds – such large companies offer unrivalled opportunities that cannot be found elsewhere.