Landlords are increasingly choosing to buy properties in secondary towns and cities rather than major city centres, new research shows.
The largest number of buy-to-let completions during 2021 was in Milton Keynes, up a whopping 667% compared to the previous year, according to Paragon Bank, whose data reveals that completions in Bristol were up by 300% and in Luton by 258%. As well as London and Manchester (300%), the top ten hotspots also included Plymouth (183%), Stoke (157%), Northampton (133%), Cardiff (70%) and Nottingham (64%).
Paragon Bank director of mortgages, Richard Rowntree, says landlord demand for city and town centre property was strong in 2021, with its analysis showing completions for house purchases increasing by 100% compared to the previous year. Landlords had been reacting to tenants’ desire to live in urban areas, but in smaller towns and cities.
“There appears to be one of, or a combination of, three factors that each of these locations share,” says Rowntree. “They are in commutable distance to a major city, they mostly have vibrant universities and they have healthy local economies.”
Paragon’s figures show a 95% increase in buy-to-let completions in the capital during 2021, with landlords concentrating acquisitions in Zones 2 and 3 as they balanced the requirement for yield, availability of property, and tenant demand.