What Investment recently published an article highlighting the top Buy To Let Areas, or 'Hotspots', in the UK. For this edition we're taking a look at three of these areas so that we can see what the current property market looks like in our homemover data. The three areas chosen are Colchester, Northampton and Leicester. Would these truly be a sound investment opportunity and what sort of returns would you be looking at?
Colchester is roughly an hour and a half away from London by train. Property on the market in Colchester has an average asking price of £313,054 and is on the market for an average of 127 days. Colchester could be an appealing area for people who work in London and can't afford to buy a property in London - with the average property price for a house in East London at £540,632 and North London at £803,330, a substantial amount more.
Northampton is on average an hour away from London by train, less than Colchester. A property on the market in Northampton has an average asking price of £270,470 and on the market for an average of 102 days. Northampton, perhaps even more so than Colchester, could be an appealing area for people who work in London, cannot afford to buy a property there and are willing to commute. Northampton is also within a reasonable commuter distance of Birmingham, another major city for workers and businesses.
The third buy-to-let city 'hotspot' of Leicester is on average just over an hour away from London by train. Leicester and Northampton are both also within driveable distance of Milton Keynes, recently announced as the fourth highest paying place to work in. A property on the market in Leicester has an average asking price of £271,252 and has an average time on market of 115 days.
Rental Market Properties
If you were to go ahead with a purchase of a property in one of these areas, what sort of returns on a monthly basis could you expect on a buy-to-let basis?
- Rental market properties in Colchester are on the market for an average rental asking price of £921pcm (per calendar month) and the properties there are on the market for an average of 87 days.
- Northampton rental market properties are on the market for an average rental asking price of £752 pcm and the properties are on the market for an average time of 69 days.
- A rental market property in Leicester is on the market for an average rental asking price of £667 pcm and properties there are on the market for and average time of 83 days.
Looking at these three areas, it's perhaps easy to see why they have been named 'buy to let hotspots', with reasonable asking prices on houses and, Colchester in particular, quite high rental earning potential.
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