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Sunderland Buy-to-Let Guide

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    Investing in Sunderland Properties

    Sunderland has some of the lowest house prices in the UK, bringing it to the attention of many buy-to-let investors.

    A port city located in Tyne and Wear, it’s known as a manufacturing town with convenient proximity to Newcastle upon Tyne.

    But is investing in Sunderland as good of a deal as it seems on the surface? Our guide will provide all the information you need to decide if Sunderland is the best location for your UK buy-to-let property.

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      Sunderland

      Buy-to-Let Property Prices in Sunderland

      The average price of property in Sunderland is one of the lowest in the UK. According to Rightmove, sold properties in the city over the last year saw an average price of £167,568. This is 3% up on last year and 9% on 2020.

      As per Zoopla’s July 2023 UK House Price Index, the UK average for house prices is £261,500, putting Sunderland below the average. While house prices have fallen in some areas such as London and the South East, the North East bucked this trend, exhibiting an average growth of 1%. Promisingly, Sunderland’s property grew the most in value in this region, rising 1.3% in June.

      While capital value has been stalling in the past few months, predictions point to overall growth for house prices across the UK in the future, meaning now is a good time to invest before prices rise.

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        Sunderland Street View

        Buy-to-Let Rental Market in Sunderland

        The average monthly rent for a room in the North East region is £514, less than the UK average of £704, with rents in Sunderland average at around £633. Private rental prices are increasing reasonably rapidly across the board, as low supply keeps upward rent pressure, and the North East is no exception.

        The North East is one of the highest gross-yielding regions in England, and Sunderland, in particular, can offer some of the best rental yields in the UK, with an average of 7.61%, according to Zoopla. This suggests that Sunderland can provide lucrative investment opportunities for those seeking buy-to-let investments.

        Sunderland has a strong reputation as a manufacturing and port city with a rich industrial history. It has shed this image in recent years, rebranding itself as a modern and dynamic place to live. The manufacturing sector, however, remains strong in the city, providing many job opportunities for those in the area. Buy-to-let investors can also target commuters travelling into Newcastle as potential tenants, especially with short-term accommodation.

        It’s important to note that Sunderland has been hit by deindustrialisation and outward migration in the past, shrinking the overall working population. The local government is trying to address this through ambitious regeneration projects to revitalise the city as an attractive place of residence.

        Buy-to-let student accommodation makes up a large part of the rental demand in Sunderland.

        According to Sunderland City Council, the student population is essential to the area’s privately rented housing market. The city is home to the University of Sunderland, and about 9000 students are based at the Sunderland campuses. The constant flow of new students keeps up demand and makes a steady stream of rental income likely.

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          Investment Properties for Sale in Sunderland

          Sunderland is home to diverse property types suitable for investment. Investors looking for seafront properties will find them in Seaburn, and the larger area of Fulwell is littered with 19th century terraced properties and 1930s semi-detached houses. The majority of housing in Ashbrooke is Victorian style, and other areas boast bungalows and detached houses. There’s also a type of property unique to Sunderland called the Sunderland Cottage, which can be described as a terraced bungalow.

          There are some modern and new build properties available as well, but they are limited compared to older properties.

          According to Rightmove, the majority of sales in Sunderland during the last year were semi-detached houses, going for an average price of £171,145. This is followed by terraced properties, which sold for an average of £123,102, while detached properties fetched £322,923.

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          Sunderland Buildings

          Buy-to-Let Investment in Sunderland: Area Breakdown

          The City Centre area of Sunderland offers proximity to places of work and the university campuses and the convenience of living in a shopping and commerce district with good transport links.

          The centre is convenient for professionals and students, but Sunderland also offers many sought-after suburban and residential areas such as Ashbrooke.

          Further out, Fulwell is a popular and upmarket area to live. It is home to Seaburn, a desirable place of residence due to its enviable seafront location.

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          Sunderland Riverside

          Sunderland City Centre (SR1)

          Average Property Prices in Sunderland City Centre (SR1)

          The average property price in SR1 is £98,314.

          Average Rental Yield in Sunderland City Centre (SR1)

          The average rental yield in SR1 is 8.14%.

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            Sunderland Street View

            Ashbrooke (SR2)

            Average Property Prices in Ashbrooke (SR2)

            The average property price in SR2 is £178,397.

            Average Rental Yield in Ashbrooke (SR2)

            The average rental yield in SR2 is 4.39%.

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            Seaburn (SR6)

            Average Property Prices in Seaburn (SR6)

            The average property price in SR6 is £249,879.

            Average Rental Yield in Seaburn (SR6)

            The average rental yield in SR6 is 3.3%.

            (Averages taken from Rightmove and Zoopla, rental yield average calculated with figures from housesforsaletorent.co.uk)

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              Sunderland Aerial View

              What is the Best Area of Sunderland to Invest in?

              Seaside areas, such as Seaburn, are popular areas to live in, meaning the property prices are higher than the Sunderland average. This affects the potential rental yield, so you may start seeing returns quicker in locations with more affordable property prices.

              If you’re looking for a suburban area, districts like Ashbrooke are closer to Sunderland city centre and can offer a better rental yield.

              But the area that offers the most generous rental yields on average is the city centre. The convenient location will assure demand for rental properties, and trends show that capital growth is increasing quicker in the SR1 postcode compared to less central areas. The city centre is also set to benefit from regeneration in the near future.

              See the best investment properties on the market with our updated area guide!

              Bridge in Sunderland

              Why You Should Consider a Buy-to-Let Investment in Sunderland

              Coastal Location

              Due to Sunderland’s coastal location and proximity to the River Wear, the area could be attractive to nature-loving renters.

              Sunderland also boasts many acres of parks and green spaces. Well-maintained cycle paths allow cyclists to enjoy the area’s beautiful natural scenery, such as the Coast to Coast and Walney to Wear routes. Sunderland is by far one of the best buy-to-let areas in the UK.

              Infrastructure

              With a population of 175,000, Sunderland is a smaller city, making it easy to get around while still providing all the trappings expected of a modern city, such as a bustling shopping district, a burgeoning arts and culture scene, educational facilities, and employment opportunities in various sectors.

              Sunderland has excellent public transport, serving the city and linking it to the rest of the country. This includes bus, metro and rail.

              Transport in the city has also been improved with investments in transport infrastructure and regeneration efforts. This includes the Sunderland Strategic Transport Corridor, a revamp of Sunderland Central train station, and expansion to the Port of Sunderland. These projects, along with others, have boosted Sunderland’s logistics industry, with some calling it the logistics capital of the North East.

              Regeneration

              As previously mentioned, the local government is aggressively revitalising Sunderland with various regeneration projects to provide a boost to local jobs and infrastructure. Around £1 billion has already been invested in the city since 2015, and the council has said they will spend a further £626 million by 2024.

              ‘Riverside Sunderland’, one of the ongoing projects, is described as the UK’s most ambitious city centre regeneration project. The 32-hectare site is being transformed into a brand new carbon-neutral urban quarter, with plans to include places for work, living and socialising, including 1,000 new homes to help increase the local population.

              It’s not just the city centre that benefits from regeneration programmes, as a continuing effort to transform the seafront areas is also in place. It focuses on Seaburn and Roker, which, according to the local government’s strategy, will have a crucial role in providing cultural and tourist attractions in Sunderland by 2025.

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              Sunderland New Builds

              The undersupply of available rental properties in the UK is one of the defining characteristics of the current market.

              Both the council and private developers are actively working to improve housing development in Sunderland by adding new homes to the area. However, it seems there are fewer options for new-build investment compared to the rest of the UK. This may change as the council’s regeneration programmes become more effective and more developers target the area as an in-demand location for newly built rental properties.

              More diverse new build investment opportunities can usually be found in major cities, including investing in luxury apartments, student accommodation, or properties appropriate for short-term rentals.

              Read More: Discover more about this investment trend with our recent buy-to-let guides, covering everything from new-builds in Bootle to the latest UK hotspots!

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                Off-Plan Property

                Off-Plan Property in Sunderland

                While newly built properties have developed a reputation for attracting both landlords and tenants alike, they are typically far more expensive than older residential homes.

                However, one way to mitigate this high cost is through off-plan property investment.

                Off-plan investors will purchase a property before it has been fully completed, usually at a heavily discounted rate compared to standard market prices.

                By jumping on early, investors can benefit from higher levels of capital appreciation and more substantial rental demand than older properties, which can lead to considerable returns in the future.

                As with new-builds, the best areas for off-plan investment will be those with robust infrastructure and high levels of regeneration. While there is some potential for off-plan investment within the Sunderland rental market, it may be more beneficial for investors to consider UK cities with more concentrated levels of new-build developments (such as Liverpool or Manchester).

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                  How Does Sunderland Compare to Other UK Regions When it Comes to Buy-to-Let?

                  The North East and the North West are currently considered property investment hot spots due to lower-than-average property prices, high rental demand, stable capital value growth, and high rental yields. Sunderland follows this trend, with some areas offering rental yields much higher than the UK average.

                  Smaller cities such as Sunderland can be considered up-and-coming as a buy-to-let investment location, but investors usually focus on major cities. In areas such as Manchester, Liverpool, buy-to-let properties in Reading and Newcastle, growth is more pronounced and continuing rental demand is basically guaranteed, meaning investors can more easily weather any unexpected economic storms.

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                    Want to Invest in Sunderland in 2024?

                    If you choose your area wisely, Sunderland can offer a buy-to-let investor an affordable property with solid returns in an up-and-coming city.

                    Looking at overall trends in the North East, this area has many advantages in terms of growth and rental demand, and we predict this trend will continue thanks to numerous regeneration projects in Sunderland and the surrounding areas.

                    But major UK cities can be considered a safer option as they are already established as attractive areas for buy-to-let investment. For example, Manchester ranks as a top buy-to-let city, along with London, Bristol and Leicester property investment areas.

                    If you’re looking to invest in a student city, choosing a location with a more secure reputation for student buy-to-lets will likely pay off in the long term. For instance, Liverpool boasts a massive student population of around 70,000 thanks to the city’s three universities.

                    There’s no easy answer to which location is best for you as a buy-to-let property investor, as it depends on your individual needs and aspirations. We believe all investors can benefit from working with a property investment company to explore their options in-depth. At RWinvest, we can offer expert advice to help you succeed in your buy-to-let investment. 

                    Looking for the perfect buy-to-let investment? RWinvest has the latest insights into the UK property market. 

                    Take a look at some of our recent area guides below:

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                    Author

                    Jessica Ferris

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                    Jessica is a property content writer at RWinvest. Keeping a close eye on the UK property market, Jessica helps our readers stay informed and up to date on the latest market news and statistics.

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