More than ever, now is the best time to invest in property. With interest rates lowering as 2024 progresses, and the market continuing to grow, many investors are considering where to invest in UK property. While buyers consider where to invest money in the UK, we’re exploring their key considerations. Namely, where are the best places to invest in UK property in 2025 and, if you know where to invest, what should you be looking for?

Where to Invest in the UK in 2025?

When we consider the best places to invest in UK property in 2025, we take several important points into account about the location including past performance, current returns and future potential. These can be broken down into several key categories such as property prices, rental yields, tenant demand, transport, employment, population growth and affordability. This highlights several key best places to buy-to-let in the UK:

Birmingham • Derby • Leeds • Bradford • Manchester • Sheffield • Liverpool • Newcastle • Leicester • Nottingham • Bristol • Glasgow • Edinburgh

With all of these points considered, we’re able to build out a complete overview of the best property investment areas in the UK. As you’d imagine, this not only highlights traditionally popular areas but exciting, emerging locations that could offer excellent returns.

Without further ado, here are the best places to invest in UK property in 2025.

Birmingham £228,000 Average Property Price (ONS)

£990 Average Monthly Rent (ONS)

5.21% Average Rental Yield

19.9% JLL Price Growth Prediction 24-28

22.2% JLL Rental Growth Prediction 24-28

Birmingham remains one of the best places to invest in UK property in 2025 due to the sheer amount of regeneration, demand and growth it is forecasting for the years ahead. Most promising is the Future City Plan which is set to revolutionise the city, adding new mixed-use developments and public spaces – it’s no wonder Birmingham is forecasting price rises of 19.9% by 2028 according to the latest JLL forecasts.

Average rents in Birmingham have risen by a huge 22% over the past five years according the Land Registry House Price Index, demonstrating just how reliable rental growth is in the UK’s second city. This isn’t surprising considering the overwhelming success of the Commonwealth Games, continuing construction of HS2 at Curzon Street, and the abundance of inward investment. Even better, more residents and businesses are viewing Birmingham as a viable alternative to London, which is contributing to greater tenant demand. This makes Birmingham one of the best places for buy-to-let in the UK. Other aspects causing prices in Birmingham to increase are:

A rising population forecast to hit 1.23 million by 2038 Tenant demand from young professionals leaving London for Birmingham’s affordability A 41% graduate retention rate bringing in new young professionals seeking rental accommodation The Birmingham property investment market is largely made up of one and two-bedroom apartments throughout the city-centre. In areas like Selly Oak, rental yields of up to 7% can be achieved, while a solid residential pipeline is highlighting new standards of living in city centre developments such as SETL and The Colmore.

In terms of where to invest, transport links also remain a key factor for Birmingham’s success. Aside from the world-class links from Grand Central and Birmingham International Airport, the second city will also soon be a major hub for HS2 towards London. Despite the extension of HS2 to Manchester being cancelled, the project still remains the most exciting infrastructure development in a generation and a key reason for Birmingham being one of the best areas when investing in UK property.

Best Rental Yields in Birmingham B29 – Selly Oak – 7%

B9 – Bordesley Green – 6.5%

B18 – Hockley – 6.5%

B15 – Edgbaston – 6.4%

B1 – City Centre – 6.1%

Featured Development SETL Jewellery Quarter, Birmingham Your Personal Sanctuary In The Heart Of Birmingham 1 & 2 Bedroom apartments available

Birmingham property prices set to increase by 19.2% by 2027 (JLL)

Birmingham rental prices set to increase by 19.3% by 2027 (JLL)

150 metres from St. Paul’s Square, The Jewellery Quarter and 150 metres from the Colmore Business District

City-centre properties achieving yields between 5% and 6%

Parking available – rare on St Paul’s Square

20% Deposit required

Estimated completion Q3 2023

Prices From

£245,000

Birmingham: Best Place to Invest in the UK? 100,000 workers in the UK’s largest professional hub outside of London 3rd best UK city for bringing in graduates with no prior links to the city Young population – 40% are under-25, a huge demographic seeking rental properties Ever-evolving regional Metro links connecting the city centre with regional communities Sits at the core of the upcoming HS2 network, which will put Birmingham within 49 minutes of London Ambitious ‘Our Future City’ plan set to regenerate the city core as well as important green links across the broader region until 2040 Derby £199,000 Average Property Price (ONS)

£748 Average Monthly Rent (ONS)

4.51% Average Rental Yield

22.8% Savills Price Growth Prediction for East Midlands 2024-28

If you’re asking yourself, why invest in UK property in 2024, Derby may be an easy answer as to why you should.

A city at the very heart of the UK, Derby bridges the gap between the North and the South and is one of the leading lights of the East Midlands. Currently undergoing a major regeneration project – the ‘2030 Derby Masterplan’ – that is transforming the local landscape, Derby property price forecasts for 2025 suggest prices could increase by 22.8% over the next four years. This isn’t to mention the impressive growth Derby property has undergone over the past 5 years of over 23%, making Derby one of the best places for buy-to-let in the UK.

Derby’s exceptional growth is underpinned by its youthful population and exceptional connectivity. The city has 17 universities all within an hour’s travel and is home to a student base of 34,000. With around 48% of Derby’s population under-35, there is huge potential demand for rental properties, especially considering Derby’s popularity with graduates:

23% of graduates go to University of Derby and stay for work 46% of graduates move to Derby for work Derby has the 7th highest graduate wage in the UK – £24,100 (vs UK average of £23,100)

It’s this younger demographic that is driving the success of Derby’s rental market and reinforcing it as one of the best places to invest in UK property in 2025. Rents increased by 9.3% since from May 2023 to 2024 – a significant jump that accelerated average rents from £684pcm to £748pcm – and this looks set to continue as demand continues to outpace supply, a factor that will no doubt drive rental yields in Derby.

Aside from its graduate retention, Derby is also driving new demand through its exceptional career opportunities. With several large-scale businesses – including Bombardier, Rolls-Royce and Toyota – contributing over 45,000 jobs to the local economy, there’s a huge amount of working professionals within the market that are helping push prices in a positive direction, helping Derby’s claim as one of the best places to invest in buy-to-let property in 2024.

Best Rental Yields in Derby DE1 – City Centre – 6.0%

DE75 – Heanor – 4.5%

DE24 – Alvaston – 4.5%

DE45 – Bakewell – 4.3%

DE21 – Chaddesden – 4.3%

Derby: Best Place to Invest in the UK? Derby’s population set to rise by 53,000 by 2039 Predicted property price growth of 22.8% by 2028 across the East Midlands Named the fastest growing economy in the UK 17 universities are within one hour of Derby 6th most productive city in the UK Featured Development Off-Plan Investment Opportunity City Centre, Derby Prime City Centre Location High Specification Apartment Designs Cafe, Co-working Space and Gym 17.5% Price Growth and 12% Rental Growth predicted by 2026 (JLL) Prices From

£185,000

Leeds £234,000 Average Property Price (ONS)

£1,095 Average Monthly Rent (ONS)

5.61% Average Rental Yield

18.8% JLL Price Growth Prediction for 2024-28

19.3% JLL Rental Growth Prediction for 2024-28

Investing in UK property with a specific interest in the North? Leeds has earned itself a reputation as one of the best places to invest in UK property in 2024 because of the strong rental returns units in this city can provide. As the second-largest banking and finance sector in the UK, Leeds has a huge pull with professionals in these sectors, which is driving demand for the rental market and subsequently pushing up rental prices. This makes the city a fantastic option for those searching for the best place to buy-to-let in the UK.

With a population of around 800,000, including a large student population from establishments such as the University of Leeds, Leeds Beckett University and Leeds Trinity University, making the city a top destination for investors seeking long-term, consistent tenant demand.

What’s more, Leeds has one of the fastest growing economies in the country and now rivals several larger European cities, which is enticing working professionals seeking higher salaries. This is reflected in the number of people moving from London to Leeds, which has doubled over the last decade, demonstrating that this Northern Powerhouse has widespread appeal to renters across the UK.

Although Leeds’ price growth in the past has been minimal compared to its peers, the market has largely been buoyed by its excellent rental demand. Recent forecasts state that Leeds’ growth will far outweigh that of the national average, with JLL suggesting that the UK average cumulative house price growth will sit at 17.6% by 2028 compared to 18.8%, firmly putting Leeds ahead of the average UK city. So, if you’re searching for the best UK city to invest in that is set to exceed the growth trajectory of the rest of the nation, you should strongly consider Leeds.

Best Rental Yields in Leeds LS3 – City Centre – 12%

LS2 – City Centre – 8.3%

LS4 – Burley – 8.2%

LS9 – Harehills – 7.7%

LS6 – Headingley – 7.5%

Leeds: Best Place to Invest in the UK? Huge student population of over 65,000 Fastest growing UK city with a local economy of £64.6 billion Fourth largest English city by population behind London, Manchester and Birmingham Coined the most diverse economy of all the UK’s main employment centres with the swiftest rate of private-sector job growth of any city in the UK Forecasted property price growth of 18.8% by 2028

Source – Joseph Mews Developments

Find out more at the Property Investor Show, 4/5 October 2024, London ExCel

Photo by Benjamin Elliott on Unsplash