2018 has been a busy year for the UK buy-to-let market. Despite continued government tinkering with things like stamp duty and mortgage tax relief, the potential for both capital growth and healthy yields has been sufficient to encourage many investors to grow their portfolios over the course of the year.
Jonathan Stephens, managing director atSurrenden Invest
2018 has been a busy year for the UK buy-to-let market. Despite continued government tinkering with things like stamp duty and mortgage tax relief, the potential for both capital growth and healthy yields has been sufficient to encourage many investors to grow their portfolios over the course of the year.
Interestingly, while the overall number of buy-to-let landlords in the UK has been falling, we've seen the best developments attract a huge amount of attention.
The right blend of on-site facilities and city centre location are proving a winning combination, particularly in key regional cities.
So here’s our three property market lessons from 2018:
1) The first is that buy-to-let investors are maturing and becoming more discerning about where they put their money.
For a property investment company like Surrenden Invest, which specialises in choosing developments that are a cut above the rest to present to its clients, it means that 2018 has been a good year.
Ancoats Gardensin Manchester is a prime example of this. Not only does the development enjoy a top notch location, just 300m from the massive NOMA site, but the quality of the apartments is just superb. Spacious, light-filled homes are complemented by an exceptional rooftop garden, coffee lounge and on-site gym, with an air of urban elegance and luxury flowing throughout.
2) The importance of regional cities such as Manchester is the our second 2018 take-away. Investors have largely fallen out of love with London, though odd pockets of potential do remain there, thanks to the sheer size and diversity of the capital's property market. Instead, buyers are enjoying the superior yields offered by regional cities across the UK.
The Totally MoneyBuy-to-Let Rental Yield Map 2018/2019 shows that Manchester, Liverpool and Newcastle between them were home to 10 of the 25 highest yielding postcode areas in the country over the course of the past year. Yields hit 9.79% in Liverpool, 8.89% in Newcastle and 7.07% in Manchester.
Investors who buy in the right locations are enjoying impressive yields. Knowing regional markets inside out was more essential than ever for property investment companies looking to maximise their clients' returns in 2018 - and will continue to be the case in 2019.
Birmingham is one of the markets that Surrenden Invest expects to see more of in 2019. Home to the superbWestminster Worksdevelopment, which provides 220 outstanding, loft-style apartments, the city is a hotbed of entrepreneurial talent and creativity.
Its fast-paced property market and thriving business community both support its position as one of the most exciting investment locations in the UK for 2019.
3) Surrenden Invest's final lesson from 2018 is that it's important to keep a steady hand as Brexit approaches.
Investing in property is ultimately about building up assets that provide returns over the medium to long term. This isn't about flipping homes for a quick profit, but about building up a stable, steady stream of income using assets that themselves increase in value over the long term too.
