Swansea Property Investment:

Why Invest in 2022? (Six Reasons)

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Is Swansea property investment a good investment in 2022?

With over 8% of Wales living in the city, there are plenty of opportunities for investment properties in Swansea.

But is Swansea buy to let investment right for you?

In this guide, we’ll look at:

  • Why invest in Swansea?
  • The best areas to invest in Swansea.
  • And more…

Let’s jump into it:

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Quick Swansea Property Stats:

  • Average Swansea property value is £190,544. 
  • Investment properties Swansea sees an average rental income of £811.18 PCM. 
  • Swansea property investment provides an average 5.11% yield. 
  • New build premium for Swansea investment property is £64,601 – cheaper than Cardiff, Wales and the UK! 
  • From 2017-2021, there were 657 new build purchases and 15,546 purchases of existing properties. 
  • 1,046 cash purchases and 1,910 mortgage purchases in 2021. 

Why Invest in Swansea?

From the affordable property to the tidal wave of unprecedented investment, Swansea has a lot to offer investors.

The city has one of the fastest-developing universities in the UK and has become a hotspot for investors looking to expand their property portfolios.

Reasons to invest in Swansea:

  1. Affordable Property
  2. Above Average Yields with High Capital Growth Potential
  3. Opportunity for Student Property Investment Swansea
  4. Major Regeneration
  5. Strong Economy
  6. Diverse Amenities

1. Affordable Property

Swansea property value rivals that of most major cities, at an average of £190,544.

Properties in Swansea cost over £64k less than in Cardiff and £36k less than in Newport.

Like most locations, detached properties are the most expensive while flats and maisonettes are the most affordable.

Average Property Prices of Major South Wales Cities

Average Property Prices of Major South Wales Cities

Data from The Land Registry, 2022

2. Above Average Yields with High Capital Growth Potential

Swansea buy to let property investors will see an average rental income of £811.18 PCM, providing a 5.11% yield (Houses for Sale and to Rent).

These high yields are 1.48% more than the UK average and a 0.69% increase on Wales’s average.

However, Cardiff offers slightly higher yields of 5.35%.

Average Rental Yields April 2022

Average Rental Yields April 2022

In 2019, there were four Swansea postcodes in the top 10 for the best rental yields in Wales.

The highest-ranking, SA1 in fourth place, provided rental yields of 5.78%.

Top 10 rental yields in Wales

Data TotallyMoney 2020

Wales house prices grew by 13.9% in the year leading up to January 2022 – an increase from the 12.4% recorded in December 2021.

Wales house prices are set to see a 3.5% increase in 2022 and increase by an average of 2.8% pa until 2026 (JLL).

UK Property Price Forecast

UK Property Price Forecast

Data from JLL, 2021

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3. Opportunity for Student Property Investment Swansea

Swansea is one of the fastest developing universities, with a student population of over 24,000.

With a predicted student invasion predicted by 2025, student rental demand in Swansea will only increase.

Time it right, and student property investment Swansea could be an excellent opportunity to expand your property portfolio and receive great yields.

4. Major Regeneration

Recent development in Swansea include:

  • £1.3Bn Swansea Bay City Deal – 3,500 capacity area at Copr Bay, hundreds of new houses, and public spaces.
  • SA1 Waterfront Regeneration Scheme – including Discovery Leisure Quarter, new offices and housing, and a student accommodation complex.
  • Maritime Quarter and Swansea Marina – Scenic hub for culture, living and commerce.
  • Green revolutionSwansea Central Area Green Infrastructure Strategy aims to increase green infrastructure to 26% by 2030 and increase tree canopy cover to 20-25% by 2044.

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5. Strong Economy

The former industrial port city is now a hub for companies in the service sector, including tech, communication and financial services.

  • The DVLA employ over 6,000 people in the city.
  • Swansea Enterprise Park was the UK’s first enterprise zone with a range of businesses and shops.
  • Historic Swansea Market has over 100 stalls and was crowned ‘Britain’s Best Large Indoor Market 2020’.
Swansea GVA compared to the UK

Source: ‘Regional economic activity by gross value added (balanced), UK: 1998 to 2019’ statistical bulletin and data tables, ONS.

In 2019 Swansea’s GVA (Gross Value Added) was £5.7 million, with a GVA per head of £22,939.

Per head, Swansea is 7.7% above the Wales average but 21.8% below the UK level.

Swansea has a 3.0% GVA increase in 2019 – higher than Wales, West Wales & Valleys, and the UK.

6. Diverse Amenities

Neighbouring the Gower Area of Outstanding Natural Beauty, Swansea is a stunning city that’s rich in amenities.

From Glyn Vivian Art Gallery and the Grand Theatre to the Dylan Thomas Centre, the Welsh city is far from short of a cultural fix.

Swansea is also one of the few UK cities to have its own beach, which is a significant pull for prospective tenants.

What are the Best Areas of Swansea?

  1. The Mumbles: Seaside region named by The Times as one of the Best Places to Live in the UK 2020.
  2. Derwen Fawr: Popular with families for its fantastic school catchment.
  3. Uplands: Up-and-coming suburb named as one of the hippest places in the UK.
  4. Parkmill: Hotspot for rural retirement in the Gower Peninsula.
  5. Llandamoc: Quiet and scenic location in North Gower.
  6. Maritime Quarter: Hotspot for young professionals offering varied Swansea buy-to-let opportunities.

Yield-driven investors might be asking:

“Where should I invest in Swansea area for the best returns?”

That’s why we’ve broken down each region’s best-performing postcode by yield and its average property price.

The best areas to invest in Swansea are:

Avg yield: 7.43%

Avg property price: £135,197

City Centre: SA1

  • Popular with student accommodation and young professionals.
  • Mostly flats in new builds or converted townhouses.

Avg yield: 5.57%

Avg property price: £149,582

North: SA5

  • Close to numerous business parks and the M4.
  • Built up of old terraces and housing estates.

North: SA5

  • Close to numerous business parks and the M4.
  • Built up of old terraces and housing estates.

Avg yield: 5.57%

Avg property price: £149,582

Avg yield: 4.16%

Avg property price: £252,926

West and South: SA2

  • Mainly residential properties.
  • Good access to the city centre and the Gower.

Avg yield: 3.22%

Avg property price: £390,427

Gowler Peninsula: SA3

  • Go-to location for affluent commuters
  • Visitor and tourist hotspot.

Gowler Peninsula: SA3

  • Go-to location for affluent commuters
  • Visitor and tourist hotspot.

Avg yield: 3.22%

Avg property price: £390,427

Where Can I Invest in Property in South Wales?

From holiday letting to student accommodation, there’s a lot of opportunity with Swansea investment property.

Although Swansea has some of the cheapest property available in South Wales, other locations are worth considering.

Cardiff has some of the highest yields in the country, while Newport property investment offers impressive capital growth.

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