Choosing where to invest in the UK can be tricky. There is a lot to consider from budget, timing to location. If you feel like you have agents pulling you in all directions and confused by the constantly changing statistics, you are in the right place. We’ve cracked the data and have done the research of where rental property is set to perform highest in the UK in 2025. Taking into consideration a balance of capital growth, rental yields and residential popularity, here are the hotspots for buy-to-lets in 2025.
Leeds
This city has been considered one of the best places to invest in by the savvy investor for a while, and it’s no surprise. With a lot to offer from universities, employment opportunities, transport links and an affordable lifestyle it is a popular choice to study and work in. It was even voted the best city to live and work back in 2021. Affordability is key to its popularity, especially for those looking to enter the market for the first time you can snap up properties around £40 cheaper than the UK average. The low entry level pushes up the yield. Zoopla reported an average rental yield of 6.3% in April 2023, and with Leeds becoming more and more in demand – the sky’s the limit for this Northern hotspot.
Derby
Another area that is set to soar in 2025 as a buy-to-let hotspot is Derby. Nestled in the East Midlands, this humble city has been growing slowly and steadily for a while. By 2039 its population is set to rise by 53,000 and it has been pinned as one of the fastest growing economies in the UK. This makes it an enviable choice for investors looking for a property with a high rental demand and solid yields. With an average rental achieving around £758 per month and a yield of 4.51% an apartment here would be an asset to any portfolio. The job market is strong with many big businesses moving to the city, persuading up to 46% of graduates to choose it as their place to work. These factors all push property prices for sales and rentals in one direction, through the roof.
Manchester
This city has been no stranger to many investment hotspot lists for a while, offering a vibrant lifestyle and excellent transport links it is popular with many graduates and those seeking opportunity Many businesses have moved their headquarters here boosting the job market and pushing prices up. Property prices have soared by over 30% in the last five years and the current average rental achieves around £1214 providing a 6.22% yield. Manchester remains a strong contender as a buy-to-let investment in the UK in 2025 and beyond with JLL predicting another 19.3% growth over the next four years.
Sheffield
If you are a first-time buyer asking where is the best place to invest in the UK, this is another city that could be the answer. Sheffield is currently undergoing a lot of redevelopment and getting a lot of attention for all the right reasons. It is home to two universities and has received significant investment into retail and leisure, boosting the job market and desirability as a place to live. A rental property here can currently achieve around £839 and a rental yield of 4.7% making it worth considering as an investment with big future potential.
The Key Takeaways
Buy-to-let properties in the UK are a valuable asset for any investment portfolio. These hotspots have been selected for providing a good balance between a steady rental yield and capital growth. The key to any successful investment, as predicted, is to choose the best location. These cities from Leeds to Sheffield are set to offer some of the best yields in the UK for 2025. This is due to affordability, redevelopment, excellent transport links, job prospects and the lifestyles they offer.
Before making any investment, it is recommended to speak to a consultant like one of the team at William Vale to discuss your specific budget and goals.