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How to find the right property investment location

Author: Gemma

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If you can find the right location, you’re already well on your way to success in property investment.

Location, location, location – there’s a reason why this has become a mantra for property investors. Settling on where you want to invest is arguably the most important decision you’ll make when embarking on your investment.

In a market like the UK, where there are many destinations to choose from, all with their own characteristics and advantages, it’s not necessarily an easy decision.

Here are three of the most important factors to consider when choosing your investment location:

Local price trends

Local price trends are among the most useful indicators of the general health of the housing market in a given location and the levels of demand for property in the area.

If capital growth is your number one priority going into an investment, you’ll want to do your research on historical price patterns to gain confidence that your asset will appreciate in value in the future.

Recent trends in the UK have painted an interesting picture where prices are concerned, with regional cities like Liverpool and Cardiff seeing strong growth, while London and the south have slowed.

The coronavirus outbreak has caused uncertainty and stagnation in property, but the well-established resilience of the UK market suggests price inflation will get back on track once the country is over the worst of the crisis.

Transport links

Accessibility and transport connections are a key consideration with any property investment, firstly because good travel links are likely to be a significant factor for prospective tenants.

Properties in popular London commuter towns like Luton, for example, will be much more attractive to workers if they offer fast and regular travel links into the capital.

Good transport services are also important from a commercial and economic perspective. Well-connected destinations that attract high numbers of visitors – in both the business and leisure sectors – are better-positioned to thrive and grow, which is positive for the property market.

Rental demand

If you’re interested in income investment – in other words buying property that will generate a regular, passive income – you need to have maximum confidence that the asset you’re acquiring will deliver consistent rental yields and minimum void risk.

One of the best ways to gain this reassurance is by doing some research into private rented sector demand in the locations you’re considering.

The general picture for rental demand in the UK recently has been positive. According to Hometrack, demand for rented homes increased by 8% during 2019, while supply of available properties dropped by 4%.

This resulted in average rental value growth of 2.6% to £886 per month in the final quarter of last year – the highest level for three years. The research also revealed that Liverpool, Cardiff and Manchester were among the top 20 cities for annual rental growth last year.

If you would like to discuss property investment opportunities in the UK and get some advice on finding the right location for you, contact Experience Invest today.

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