UK’s Top Buy-to-Let Hotspots: Where Landlords Are Investing Now

Find out where landlords are still buying in the UK with our list of top buy-to-let hotspots. Discover the reasons behind these investment choices today.

Portfolio landlords are shifting their focus away from London and other southern English cities, opting instead to invest in the midlands and north of England. According to analysis conducted by buy-to-let mortgage lender Paragon Bank, cities such as Manchester, Birmingham, and Nottingham have seen a surge in interest from landlords with four or more properties. In fact, the top 10 most popular buy-to-let postcodes of 2023 were predominantly located in the midlands and north, with only one southern region postcode making the list.

Manchester's M14 postcode emerged as the most sought-after location for buy-to-let landlords, encompassing areas like Fallowfield, Ladybarn, and Rusholme. Situated between the University of Manchester and Manchester Metropolitan University, this postcode boasts a high student population, a variety of dining and entertainment options, and easy access to green spaces and transportation links. Investors in this area have the potential to achieve gross rental yields of up to 7.5 percent, making it an attractive prospect for portfolio landlords.

Following closely behind is Birmingham's B29 postcode, covering neighborhoods such as Selly Oak, Edgbaston, and Shenley Fields. With its proximity to the University of Birmingham and the Queen Elizabeth Hospital, this area appeals to investors looking to tap into the student market and benefit from the presence of a major employer. Despite higher property prices, landlords can still generate yields of up to 6.9 percent in the B29 postcode.

Rounding out the top three is Durham's DH1 postcode, offering yields of up to 7.3 percent. Known for its mix of suburban and rural areas, DH1 is particularly popular among students attending Durham University, a member of the prestigious Russell Group. The university's strong academic reputation and consistent national rankings make DH1 an attractive investment opportunity for landlords.

The trend of portfolio landlords shifting their focus to the midlands and north of England reflects the growing appeal of these regions for buy-to-let investments. With strong rental yields and thriving student markets, cities like Manchester, Birmingham, and Durham are emerging as hotspots for property investors looking to diversify their portfolios.