The North East is starting to boom. With government funding scaling up and a dynamic housing market with significant room to grow, here’s why now is the time to invest.
Tenant demand for rental properties
The North East is a significant part of the UK moving towards a greener future, with considerable investments in the green energy industry. Offshore wind will be a focus, with a new Quay development to replace the Redcar Steelworks site on Teesside, representing just how much things are changing. With the government funding more projects to hit their net-zero emissions target, 25,000 new jobs will be created in this region alone by 2030. While housing is more affordable here than in other areas (more on this shortly), many people will be looking for homes to rent. Furthermore, many of these jobs will be contractual, with workers needing rental accommodation rather than setting down permanent roots in the area.
Tourism is another key element of the North East. With staycations still a popular choice due to the pandemic, people visit the area as their holiday destination of choice. While holiday lets are typically reserved for regions like the South West, the North East still has millions of visitors every year. Before the pandemic, research conducted by Visit Britain showed that tourists visiting these spots typically had higher incomes and opted for self-catered accommodation. This indicates a great opportunity for holiday-let landlords or investors looking to diversify their portfolio.
The North East is also home to many universities, including two large Russell Groups, Durham and Newcastle. As well as the booming student let market, companies look to these organisations for new graduates, meaning the young professional market needs housing too. With rental properties being the most affordable, there will be constant demand from this group.
A region of ongoing tourism and new jobs means a steady cycle of people looking for rental homes. The unsaturated market means that this is just as much an opportunity for landlords to succeed.
At an average of £153,000, homes in the North East have the lowest purchase prices in the country. Not only that, in Q3 of 2021, landlords received an average yield of 6.2%, ranking second regionally in the country. The significant return on investment from rentals and the low house prices is a great reason alone for landlords to invest.
Local investment in the region is also popular. Paragon bank, a specialist Buy to Let lender, published research that states that portfolios in the area are currently the smallest in terms of total value across England and Wales. Further research from Paragon bank shows that landlords in this region are more likely to have bought or sold a property than those anywhere else in the country for the past three months. Clearly, there’s excitement around this regional market, so why not get in on the action?
The North East region is not currently a flooded market, despite the massive demand from tenants and the success in the private rented sector. As more and more landlords are starting to invest, now is the time to get involved. To understand your buy to let finance options, get in touch today. Call me, Andy McOwat on 01625 416396 or email me, email@example.com, and we can get started.