Where should you invest in UK property? A guide to factors landlords commonly consider.
This article is for general information purposes only. It does not constitute financial, tax, or investment advice. Property investment carries risks and may not be suitable for everyone. You should seek independent advice from a qualified financial adviser or mortgage broker before making any investment decisions.
The UK has a broad and varied housing market providing a range of opportunities for you as a buy-to-let investor. With around 30 million homes and more being added all the time, there's no shortage of stock to consider. Where you invest is one of many factors that can affect your experience as a landlord.
Published rental yield data suggests yields have historically been higher in certain regions, such as the North East and Scotland, though this varies by property, location, and market conditions. By contrast, the lowest rental yields are currently in London. You’ll also find differing levels of house price appreciation – both by region and by city.
But you should also consider practicalities. Being a landlord can be hands on, even if you employ a local letting agent. Who will visit the house to solve any problems? Who will check maintenance work? If you plan to manage the house, you’ll probably want to buy a property that’s close to where you live.
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You need to think through both your investment goals and practical considerations. Are your investment goals realistic? And are you prepared for the responsibility of managing a buy-to-let?
Are you familiar with the Renters’ Rights Act? The legislation is designed to strike a fair balance between landlords and tenants. You should be aware of its implications.
What are my investment goals?
Historically, people have invested in property for income yield and capital gain. Before purchasing a buy-to-let property, it’s a good idea to be clear about your goals.
Calculating the gross investment yield is easy – you estimate the total annual rent as a percentage of the cost of the property. For instance, a £6,500 annual rent on a house worth £100,000 equates to a 6.5% gross yield. This is for illustrative purposes. Actual returns will depend on your specific property, costs, and circumstances. But you should also calculate your net yield, based on how much your rent will be after costs such as maintenance and any voids between tenants.
Estimating future capital performance is harder. Various property portals and estate agents publish forecasts. These should be treated as indicative only and not relied upon for investment decisions. Additionally, you may form your own view based on local supply and demand for houses, especially if a catalyst such as urban regeneration looks likely to encourage people to live in your area.
Am I financially ready?
Before proceeding, it's important to consider whether your finances are in order. This includes upfront costs such as the deposit, stamp duty, and professional fees, as well as ongoing costs. A mortgage broker or financial adviser can help you understand whether the numbers work for your situation. Additionally, it’s wise to have a contingency fund to cover any property improvements, repairs, missed rental payments or unexpected voids.
Increasing landlord taxes will also affect calculations from April 2027. What’s more, some landlords have to comply with the Making Tax Digital initiative from April 2026 onwards.
Landlord responsibilities
With the introduction of the Renters’ Rights Act being rolled out in stages, and the most significant changes from May 2026, the balance between tenants’ and landlords’ rights is shifting. It’s wise to be familiar with the Act and the rights of tenants.
What’s more, you should be familiar with other longstanding landlord responsibilities, such as requirements for an Electrical Installation Condition Report every five years and an annual gas safety test.
As an NRLA member, you have access to our exclusive property management platform, Portfolio. Get prompt reminders when important licences and documents are due so you can be landlord confident.
You can also take part in any of our compliance training at a discounted rate.
When deciding where to invest you need to balance several things, some financial, some practical. How you weigh up these factors depends on your investment goals and how hands on you plan to be in terms of managing your property.
Likely financial returns
You’ll find that rental yields for buy-to-let properties are published widely online. Published gross rental yields vary significantly by region. As a general illustration, yields quoted for the North East have tended to be higher than those in London, though figures change over time and vary considerably within each region. These figures are gross and do not account for any costs such as maintenance, voids, or mortgage payments.
Recent decades have been a golden age for buy-to-let investors partly due to capital gains, which have varied widely from one area to another. More recently, prices haven’t risen as drastically, although some less expensive areas have experienced increases.
In 2025, for instance, residential property prices varied significantly by region. Some areas saw strong growth while others, such as East Anglia, fell by 0.8%, according to Nationwide. The average increase for the country was 1.7%. On average, UK prices are around 50% higher than they were in 2007.
Does urban regeneration lift property prices?
Yes, regeneration and new transport links have a record of boosting both house prices and rents. They often make a city more attractive to live in and boost demand for housing. In one of the most celebrated examples, the regeneration of King’s Cross in London in the 2010s revitalised the area and sparked a surge in house prices.
More recently, the Elizabeth Line has improved travel across the London commuter belt since it opened in 2022, stretching from Reading in the west and Shenfield in the east. Across all the London stations on the line (excluding central London’s Zone 1), average house prices grew by 80% from 2008 to 2023, according to research from CBRE. This is a premium of 6% compared to the surrounding areas. Between the line’s 2022 opening and 2023, achieved rents around the stations increased by 12%, a 2% premium to the wider market.
"Some landlords consider proximity to regeneration schemes when choosing a location, though the timing and scale of any impact on prices or rents can be difficult to predict. Further research from CBRE shows that in 11 areas neighbouring London regeneration zones, house price rises outstripped the rest of the capital. The growth premium averaged 2.2% a year. Past performance in these areas is not a reliable indicator of future results, and the impact of any specific scheme will depend on many local factors.
There are currently regeneration schemes and new transport links affecting cities like Birmingham, Liverpool and Manchester. The highest profile is the HS2 high-speed rail link between London and Birmingham. Due to open in the 2030s, it will cut journey times between the UK’s two biggest cities to just 42 minutes, down from 77 minutes today. Bringing Birmingham and the West Midlands within commuting distance of London, HS2 could have a similar effect to the Elizabeth Line.
The convenience factor
But investing in a buy-to-let isn’t just about the financial returns. There’s a practical side to owning and managing a property that can be time consuming. If you plan to manage the property yourself, you’ll want it to be within a reasonable distance of where you live, as you’ll have to visit the property to meet tenants and oversee maintenance.
If you intend to use a letting agent, you have more flexibility. However, it’s a smart idea to research the typical management fees in an area, as they can eat into your rental yield.
Different regions have different rules
When making your choice of region, it’s important to be aware of any differences in the rules governing buy-to-let. The rules vary depending on whether your property is in England, Wales, Scotland or Northern Ireland, largely due to responsibility for housing being a devolved matter.
Depending on location, there are significant differences covering landlord registration, licensing, tenant eviction procedures, tenant deposits and tax surcharges.
You’ll also find that councils have specific licensing schemes. These cover issues such as property licensing and definitions of houses in multiple occupation (HMOs).
When considering the best places to invest in property in the UK, you have a lot to consider. Your likely rental yield is straightforward to estimate as published yields reveal the most attractive areas. What’s more, yields are fairly stable. Capital growth is less predictable, though, as historic returns aren’t a reliable guide to the future.
Best for high rental yields
You’ll find that the places with the highest rental yields also tend to be the areas with the cheapest house prices. Below are the five UK regions with the highest yields, according to the Zoopla property portal (as at September 2025).
- North East. The average gross rental yield is 7.9% at the time of writing, based on an average monthly rent of £748 and an average price for a buy-to-let property of £114,098. The top three local authorities are County Durham (8% yield); Darlington (7.8%); Gateshead (8%).
- Scotland. The average gross rental yield is 7.6%, based on an average monthly rent of £861 and an average price for a buy-to-let property of £136,070. The top three local authorities are Renfrewshire (9.5% yield); East Ayrshire (10%); West Dunbartonshire (9.2%).
- North West. The average gross rental yield is 6.8%, based on an average monthly rent of £932 and an average price for a buy-to-let property of £163,559. The top three local authorities are Burnley (8.2% yield); Blackpool (7.2%); Preston (7.2%).
- Wales. The average gross rental yield is 6.5%, based on an average monthly rent of £918 and an average price for a buy-to-let property of £168,859. The top three local authorities are Blaenau Gwent (7.6% yield); Neath Port Talbot (7.5%); Merthyr Tydfil (7.2%).
- Yorkshire and the Humber. The average gross rental yield is 6.5%, based on an average monthly rent of £845 and an average price for a buy-to-let property of £156,660. The top three local authorities are Hull (8% yield); North East Lincolnshire (7.7%); Barnsley (7.3%).
It’s best to treat these broad averages as just that, as yields can vary within each area. For instance in Scotland, Aberdeen buy-to-let properties offer an average gross yield of 8.3%, according to Zoopla. By contrast, Edinburgh properties offer an average yield of 6%.
The UK region with the lowest gross rental yield is London at 5.1%. But properties in some of its less well-off local authorities offer higher gross yields – Barking and Dagenham has a gross rental yield of 6.22% and Newham a yield of 6%.
Best for capital gains
Some analysts and property portals have published forecasts suggesting different regional patterns of price growth in coming years. These are speculative and based on specific assumptions, they should not be treated as reliable predictions.
Returning to Zoopla, its UK top 10 areas for price growth in 2026 are nearly all in Scotland. Zoopla bases its forecasts on four key market indicators from 2025: price growth, days to sell, the percentage of homes with a 5% price cut, and the percentage of homes unsold after six months. These forecasts are published for general interest and do not constitute investment advice. Property markets are unpredictable and actual outcomes may differ significantly.
Zoopla’s top 10 is as follows:
- Motherwell
- Glasgow
- Paisley
- Falkirk
- Kirkcaldy
- Edinburgh
- Kilmarnock
- Perth
- Inverness
- Wigan
Taking a longer-term perspective, the estate agent Hamptons sees modest growth over the four years from 2024 to 2028, with the North East and Scotland playing catch-up with London. These forecasts are published for general interest and do not constitute investment advice. Property markets are unpredictable and actual outcomes may differ significantly.
Hamptons’ forecasts for total house growth over the period are as follows:
- North East 16.4%
- Scotland 13.6%
- Yorkshire & Humber 12.5%
- West Midlands 12.0%
- North West 10.9%
- Wales 10.4%
- East Midlands 10.4%
- South West 5.1%
- East of England 4.1%
- South East 3.0%
- London 0.5%
The average forecast growth for property in the UK over this period is 8.2%.
Best for regeneration
Major new transport links and urban regeneration schemes often boost property prices, although schemes may take many years to come to fruition. If you want to invest in city area that are being regenerated, you should do some research to check how long the scheme may take, if there are planning hurdles to overcome and whether prices have already risen.
Some of the UK’s largest current regeneration schemes are:
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Manchester Victoria North. One of the UK’s biggest regeneration schemes with a target of 15,000 homes over two decades.
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Liverpool Waters. A 30-year scheme to transform the city’s northern docks, creating thousands of homes and commercial spaces.
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Birmingham Smithfield. Transforming part of the city centre, this scheme aims to supply 3,500 homes in the 2030s.
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Leeds South Bank. Aims to extend the city centre, adding 8,000 homes in the 2030s.
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London Old Oak Common. Centred on the new super-hub station connecting HS2 with the Elizabeth Line. Aiming to construct 25,500 homes from the 2030s.
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Bristol Temple Quarter. A multi-decade project to build 10,000 homes around an improved Bristol Temple Meads railway station.
Let’s recap. When deciding where to invest in property in the UK, you should:
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Research the rental yield
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Consider how property prices in different areas have changed historically, while bearing in mind that past trends are not a reliable indicator of future performance.
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Consider the practicalities of investing away from where you live
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Where to invest in property FAQs
Where is the best place to buy a buy-to-let property in the UK?
Generally speaking, rental yields are the main consideration for buy-to-let investors and the top three regions for yield are the North East, Scotland and North West.
Is the UK a good place to invest in rental property?
The UK has a long-established private rental sector with clear legal frameworks for landlords and tenants. As with any financial commitment, outcomes vary and past trends do not guarantee future results.
Where are the best regions of the UK to invest for buy-to-let capital returns?
From a capital gains perspective, the North East and Scotland rank highly among forecasters.
Where are the best areas to invest for regeneration?
Quite a few cities currently have areas of urban regeneration, often associated with new transport links. In the North and Midlands, you can find areas of regeneration in Birmingham, Leeds and Manchester. In the South, there are schemes in Bristol and London.
What are the best cities to invest in property?
There is no single “best” city for property investment. The right choice depends on your goals, your budget, and how involved you plan to be in managing a property. In general, investors tend to look for cities with strong employment, growing populations, good transport links, and a steady demand for rental housing.
Many people also pay attention to places undergoing regeneration or major infrastructure improvements, as these can make an area more attractive to live in over time. However, it is important to remember that past performance does not guarantee future results, and every city contains neighbourhoods that perform differently.
Which part of the UK is best for property investment?
Different parts of the UK offer different types of opportunity. Some regions are known for higher rental yields because property prices are lower, while others are associated with long-term price growth or greater stability.
When choosing a region, it is important to think about more than just potential returns. Practical considerations such as local demand, regional regulations, and how easy it is to manage a property from where you live can be just as important. What works well for one investor may not be right for another.
Is the UK a good place to invest in property?
The UK has a long-established rental market, with clear frameworks that set out the rights and responsibilities of both landlords and tenants. This provides a structured environment for anyone considering property as a long-term investment.
However, investing in property is not without risk. Market conditions, legislation, and tax rules can change over time, and landlords must stay informed and compliant. Understanding your responsibilities, planning for costs, and taking a long-term view are essential. For many people, property is one part of a broader financial picture rather than a guaranteed source of returns.