Investing in Yorkshire property has proven to give excellent yields in recent years. It’s fairly well known that investing in property is a great way to make money. But why Yorkshire?
Investing in Yorkshire Property – Why Now is a Great Time
With the recent cut in interest rates, now is a great time for you to invest in property. Banks will be able to lend more and investors can borrow more, paying back less interest. People are aware that there is little point in saving your money in a bank account and investing it into a house is much more economically beneficial. The stock market is currently unstable and investing can be risky, however investing in property is less of a risk, in this post we explain why.
Over the past three years, there has been a general slowdown in UK house price growth (ONS). The slowest growth has been in the North East of England (Newcastle/Sunderland area) where house prices fell by 2.9% last year. The South East has also struggled with house prices falling 2% in 2019. Yorkshire did show a small amount of growth (see graph below), this growth is expected to continue. Property experts at Savills predict that house prices in Yorkshire will rise 21.6% over the next five years. In comparison, they predict London will only grow by 4%.
The recent slowdown was mainly due to some uncertainty surrounding Brexit and the General Election. Now Brexit seems to be getting resolved we have seen house prices in Yorkshire start to gradually creep up in 2020.
“In respect of housing, Yorkshire has greater capacity for house price growth relative to incomes than southern regions and will continue to see strong growth next year.”Cameron Sanderson, development surveyor at Keyland Developments.
Growth is particularly likely in West Yorkshire where property demand currently outweighs supply.
Power Up the North
A saying we’ve heard a lot here in the north of England but it looks like something is now being done about it. Many large organisations have moved up north from London. And with the HS2 recently given the go-ahead, getting from Yorkshire to London is going to get quicker and easier.
Many large organisations are moving to Yorkshire. Leeds is a creative and digital hub, bursting with young energetic professionals. Huddersfield also has its fair share of digital agencies. Leeds is also home to ITV and Channel 4 recently moved a large majority of their offices up from London. This growing city is an employment hotspot and the well-paid jobs here support high demand in the Leeds and West Yorkshire property market. Yorkshire is also one of the fastest-growing populations, great news for property investors.
Yorkshire could be described as a sleeping giant, the Yorkshire economy is £110bn per year – that’s around twice the size of Wales and larger than 11 EU countries. With the continued investment and the growth of young professionals choosing northern towns and cities over London this will undoubtedly rise.
Property Investment in Huddersfield
So we’ve established Yorkshire is a great place to invest, but where in Yorkshire is the best? We’ve found Huddersfield to be particularly great. A town with a rich history is now one of the upcoming areas in the United Kingdom.
Why Huddersfield, West Yorkshire is a great place to invest:
- Low house prices
- High demand for rentals and HMOs
- Location & Transport Links
- Large, Growing University
- Volume of young professionals
Low House Prices
The house prices in Yorkshire are currently low and Huddersfield is one of the cheapest areas within Yorkshire. According to Right Move the average house price in Huddersfield in 2020 is £181,178. However, many 3 bedroom houses close to the town centre (Moldgreen, Aspley, Birkby, Lockwood) can be purchased for under £100,000. These can often be converted into 4/5 bedroom HMOs. In comparison, the national average house price is approx £234,000 often with less room for development.
High demand for rentals and HMOs
Yorkshire offers strong letting demand and good prospects for landlords and investors. The Yorkshire Post states that one in five people in this area rents a home.
As the demand for housing continues to outweigh supply people are getting used to living in HMOs. Young professionals, especially recent graduates are happy to live in HMOs to meet new people and have affordable living without the worries of owning their own house. As Modus Lets manage the tenants and rentals foreign investors have really appreciated this service. The majority of students also live in either halls of residence or an HMO. In 2020 here at Modus we have seen an uplift in viewings and rental enquiries.
Location & Transport Links
Geographically Huddersfield is ideally situated with beautiful surroundings of its own, lots of green spaces and a pleasant landscape. However the real selling point is the fact that you can be in Leeds, Bradford and Manchester in under 30 minutes on the train, or if you’re driving, just hop on the M62, head east and you’ll be in Leeds in about 25 minutes, head west for 35/40 mins and you’ll be in Manchester. Or you can drive to Sheffield, Harrogate and York and be there in under 1 hour. Many people who live in Huddersfield do commute to these cities for work, especially Leeds. The National Parks of the Lake District, Yorkshire Dales, North York Moors and the Peak District are also within easy reach, which offer excellent outdoor activities.
Large, Growing University
Student accommodation consistently provides high yields. The University of Huddersfield has around 24,000 students and a growing reputation as one of the best Universities for teaching in the UK. The student population is growing year on year as more students chose Huddersfield as a place to study. Around 24% of students are international, as it’s rated one of the best in the UK for international students. This brings a real international feel to the town with students from every corner of the globe but it also increases demand for HMOs as international students cannot live with their parents, like many English students do. International students are also more likely to have to rent a HMO as they are nearly always more affordable than halls of residence and single lets. There has been significant investment within the University in recent years, it recently opened a new Student Central, which was a £22.5m development and the new architecturally-outstanding £30m Barbara Hepworth building for art, design and architecture students. All this investment has property investors licking their lips!
Lots of Young Professionals
The best tenants for landlords are young professionals. They tend to be out at work a lot and genuinely care about the environment they live in. Because Huddersfield has a young population this creates a rental demand ready for investors to capitalise on.
At Modus every tenant goes through numerous checks so we’ve had great tenants but fortunately for us there are a large amount of young single professionals looking for rooms to rent in the Huddersfield area.
Investing in Yorkshire property has become very popular with international investors as well as British nationals. We have seen a recent influx of overseas investment in Yorkshire property, around 70% of our investors are from outside the UK. This has lead to Modus opening up an office in Hong Kong and Modus Accountants, who are based in Oxford, England can help overseas investors set up a UK company. We then hand over to our project managers who then work with builders to improve the property, adding value and more rooms if the property is being converted into a HMO. We then add the furnishings before handing over to Modus Lets, who manage the rentals out the property. This full concierge service allows International investors to do all this without leaving their home. Although many do love to come and see the property and the Modus offices in Huddersfield and Oxford. Modus has been lucky enough to work with investors from all over the world from the USA – Sweden – Singapore – Australia and plenty more in-between, proving that the UK is a great place to invest wherever you reside.
Time for You to Invest?
If you’d like to get started investing in Yorkshire property contact us now at firstname.lastname@example.org