Best Place to Invest in Property UK: Why the North West Keeps Winning

The short answer: for yield-focused buy-to-let investors, the North West of England has been the standout region for three consecutive years, and the gap is widening.

Key Takeaways

• North West Yields Lead: Gross rental yields of 7–9% across the North West, roughly double London's 3.5–5%.
• Fastest Price Growth: ONS data shows North West prices rising 4.7% annually – the highest in England – while London fell 2.5%.
• Investors Heading North: Hamptons data shows 65% of London-based investors now purchase outside the capital, with 18% buying in northern regions.
• Lower Entry Costs: A 25% deposit on a North West property averages £55,000 versus £138,500 in London.
• Strongest Five-Year Outlook: Savills projects 25% cumulative growth in the North West by 2030, compared with 10.6% for London.

The Yield Gap: North West vs London in Hard Numbers

Rental yield is the single metric that separates a cash-flowing investment from one that bleeds money every month. Here is where each region stood in mid-2026.

Property Passport's 2026 regional breakdown puts it plainly:

• North West England: 7.0–9.0% gross yield
• North East England: 7.5–9.5%
• Yorkshire and the Humber: 7.0–8.5%
• West Midlands: 6.0–7.5%
• South East: 4.0–5.5%
• Greater London: 3.5–5.0%

In practical terms, a £220,000 apartment in Liverpool generating £1,350 a month gives you a gross yield north of 7.3%. A £554,000 flat in London generating £2,294 a month – the ONS average – returns just under 5.0%. The northern investor earns a better percentage return on less than half the capital outlay.

Quick FAQ:

Q: What rental yields can investors expect in the North West?

A: North West gross rental yields typically range from 7% to 9%. Liverpool city-centre flats average 7–8%, with some suburban areas exceeding 9%. Manchester and Salford deliver 7–8%, while towns such as Burnley and Preston can reach 7–9% on lower-priced stock. These figures are roughly double what most London postcodes achieve.

House Price Growth: The North Is Pulling Away

Yield tells you what a property earns today. Capital growth tells you what it will be worth tomorrow. On both measures, northern England is outperforming the South.

The UK House Price Index for June 2026 (HM Land Registry / ONS) recorded:

• North West: +4.7% annual growth – the highest in England
• North East: +4.3%
• Yorkshire and the Humber: +3.6%
• South East: +0.3%
• London: –2.5% – the only region in decline

That is a 7.2 percentage-point gap between the best-performing region (North West) and the worst (London). It is not a blip. April 2026 data showed the same pattern: the North West at +7.2% annual growth while London sat at –2.1%.

 

Savills' revised mainstream residential forecast projects cumulative growth to 2030 of 25% for the North West and Yorkshire, compared with 10.6% for London. The national average sits at 18.5%. For a £220,000 North West purchase, that 25% projection translates to roughly £55,000 of capital appreciation over five years – on top of the rental income earned along the way.

Quick FAQ:

Q: Is the North West the best place to invest in property in the UK?

A: Based on current data, the North West consistently ranks among the strongest UK regions for property investment. Gross rental yields across the region average 7–9%, compared with 3.5–5% in London. The ONS House Price Index for June 2026 shows North West prices growing at 4.7% annually – the highest of any English region – while London fell 2.5%. Savills forecasts 25% cumulative house price growth in the North West by 2030, well above the 10.6% projected for London.

Why London Investors Are Heading North

This is not just theory. Investor behaviour has already shifted – and the data is striking.

Hamptons' 2025 buy-to-let analysis found that a record 39% of all buy-to-let purchases were in northern England or the Midlands, up from 24% in 2007 and 34% in 2022. The South's share dropped to 43%, down from 53% in 2015.

Three factors work together:

• Entry price: the average investor buying in the North and Midlands paid £150,480 – 49% less than the £292,240 southern average. That price gap alone saves around £11,190 in stamp duty.
• Yield advantage: investing £198,550 in the North East generates roughly £18,400 in annual rental income – 62% more than the same capital deployed in London.
• Portfolio expansion: the capital required for one London flat buys two or three units in Liverpool or Leeds, spreading risk across tenants and locations.

Perhaps the most telling figure: 65% of London-based investors now purchase properties outside the capital. Of those, 18% are buying in northern regions – triple the proportion from a decade ago.

Quick FAQ:

Q: Why are London investors buying property in the North?

A: Affordability is the main driver. The average buy-to-let purchase in northern England and the Midlands costs around £150,480 – roughly half the £292,240 average in the South. That lower entry price delivers higher yields, lower stamp duty and better cash-flow from day one. Hamptons data shows 65% of London-based investors now purchase outside the capital, with 18% buying in northern regions – triple the proportion from a decade ago.

The Regeneration Factor

Yield and price growth do not appear from nowhere. The North West's performance is underwritten by some of the largest regeneration programmes in Europe.

Liverpool: more than £14 billion of active regeneration including Liverpool Waters (£5.5 billion waterfront project), the Bramley-Moore Dock stadium development, Paddington Village and the Knowledge Quarter.

Manchester: HS2 and Northern Powerhouse Rail connectivity (part of a £45 billion transport programme), Victoria North (formerly Northern Gateway), and continued expansion of MediaCity and the Oxford Road Corridor.

Leeds: South Bank regeneration (the largest city-centre development in Europe), Channel 4's relocated HQ, and a growing financial services cluster.

Birmingham: post-Commonwealth Games momentum, HS2 Curzon Street station build, and the Smithfield regeneration quarter.

These are not speculative plans. Cranes are in the ground, budgets are allocated, and completion dates are published. For property investors, regeneration is the leading indicator – prices follow infrastructure, not the other way around.

The Affordability Equation

Even if yields and growth were identical across regions, affordability would still push the argument northward.

The UK House Price Index for June 2026 shows:

• North West average price: £220,000
• Yorkshire average price: £208,000
• London average price: £554,000
• South East average price: £380,000

A 25% buy-to-let deposit in the North West is roughly £55,000. The same deposit in London is £138,500. For the price of one London flat, an investor can secure two to three cash-flowing units in northern cities – each individually yielding more than the single London property would.

Monthly mortgage costs reflect the same divide. Nationwide data from mid-2026 shows mortgage payment increases of around £244 per month in London versus just £69 in the North East. Northern investments are not only cheaper to enter – they are cheaper to hold.

Quick FAQ:

Q: How much deposit do I need to invest in North West property?

A: Most buy-to-let mortgages require a 25% deposit. With the average North West investment property priced around £220,000, that means roughly £55,000 upfront – compared with approximately £138,500 for an equivalent purchase in London at £554,000. Some new-build developments offer reservation deposits from £5,000–£10,000, with staged payment plans that reduce the cash needed before completion.

What About Risks?

No region is risk-free. Northern markets typically carry higher void periods in some postcodes, and tenant demand varies more sharply between city centres and outlying areas. Some lower-priced stock that inflates headline yield figures requires significant management input.

The mitigation is straightforward: focus on city-centre locations with proven tenant demand, choose new-build or recently refurbished stock that minimises maintenance costs, and work with a lettings agent who knows the local market. A 7.5% yield on a well-located Liverpool apartment is a fundamentally different proposition from a 9% yield on a terraced house in a town with limited employment.

London, meanwhile, carries its own risks – negative price growth, tightening rental regulation, and yields that barely cover mortgage interest at current rates.

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Where Exactly in the North West?

The North West is a broad region. Within it, four cities dominate investor interest for different reasons.

Manchester is the region's economic engine – the UK's largest economy outside London, with rental demand driven by universities, media, tech and financial services. Average prices are higher than the regional norm (circa £247,000), but tenant quality and occupancy rates are consistently strong.

Liverpool offers the highest yield-to-entry-price ratio of the four. City-centre apartments start below £185,000 with gross yields of 7–8%. More than £14 billion of active regeneration – from the Everton stadium at Bramley-Moore Dock to the Knowledge Quarter – is reshaping the city's investment geography. Explore our full Liverpool investment guide for a deeper breakdown.

Leeds is the UK's largest financial centre outside London and Edinburgh, with South Bank – the biggest city-centre regeneration project in Europe – still in early phases. Yields are moderate (5.5–7% city centre) but capital growth potential is significant.

Birmingham benefits from HS2 construction, Commonwealth Games infrastructure, and a young, growing population. The West Midlands delivers 6–7.5% yields with strong demand from young professionals.

The Bottom Line

The data is unusually clear. The North West delivers higher yields, faster price growth, lower entry costs and stronger five-year projections than London or the South East. The question for investors is no longer "should I look north?" – it is "which northern city suits my strategy?"

Every investor's starting point is different: some want maximum yield, others want capital appreciation, and many want a balance of both. The advantage of the North West market is that it can serve all three – and the numbers, as of September 2026, back that claim up.

Frequently Asked Questions

Is the North West the best place to invest in property in the UK?

Based on current data, the North West consistently ranks among the strongest UK regions for property investment. Gross rental yields across the region average 7–9%, compared with 3.5–5% in London. The ONS House Price Index for June 2026 shows North West prices growing at 4.7% annually, the highest of any English region, while London fell 2.5%. Savills forecasts 25% cumulative house price growth in the North West by 2030, well above the 10.6% projected for London.

What rental yields can investors expect in the North West?

North West gross rental yields typically range from 7% to 9%. Liverpool city-centre flats average 7–8%, with some suburban areas exceeding 9%. Manchester and Salford deliver 7–8%, while towns such as Burnley and Preston can reach 7–9% on lower-priced stock. These figures are roughly double what most London postcodes achieve.

Why are London investors buying property in the North?

Affordability is the main driver. The average buy-to-let purchase in northern England and the Midlands costs around £150,480 – roughly half the £292,240 average in the South. That lower entry price delivers higher yields, lower stamp duty and better cash-flow from day one. Hamptons data shows 65% of London-based investors now purchase outside the capital, with 18% buying in northern regions – triple the proportion from a decade ago.

Which northern cities offer the best property investment returns?

Manchester, Liverpool, Leeds and Birmingham each offer a different investment profile. Manchester combines strong tenant demand with a diverse economy. Liverpool delivers higher yields on lower entry prices, supported by £14 billion of regeneration. Leeds benefits from a growing financial services sector, while Birmingham’s Commonwealth Games legacy and HS2 connectivity attract long-term capital growth. All four cities feature in Savills’ top-performing regions through 2030.

How much deposit do I need to invest in North West property?

Most buy-to-let mortgages require a 25% deposit. With the average North West investment property priced around £220,000, that means roughly £55,000 upfront – compared with approximately £138,500 for an equivalent purchase in London at £554,000. Some new-build developments offer reservation deposits from £5,000–£10,000, with staged payment plans that reduce the cash needed before completion.