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5 Essential Factors to Help UK Property Keep Value

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    What Do Investors Need to Consider to Ensure Their Property Holds Value Over Time?

    As a property investor, you’ll want to ensure your investment holds value and enjoys substantial capital appreciation until you decide to sell up.

    As such, there are numerous things you may want to consider about a buy to let property to ensure that it appreciates in value and remains desirable to tenants.

    Recently, Jonathan Rolande from the National Association of Property Buyers highlighted various factors that affect the property value of homes.

    Today, we will look at Rolande’s advice and analyse where you could find good-value properties that meet these criteria in 2024.

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      Energy Efficiency

      One of the key things investors need to be aware of is energy efficiency. With higher living costs, many tenants are looking for properties that allow them to spend less on energy bills.

      Energy-efficient properties can include double or triple-glazed windows, insulation around the hot water tank, solar panels, smart meters, heat pumps and more.

      According to Rolande, homes in rural areas are less energy efficient due to the higher costs of installing eco-friendly technology and features.

      If you want to buy a property that solves energy-efficiency issues, look at city centre apartments, particularly new buildings.

      Consider The Gateway in Liverpool, an upcoming project by Legacie Developments.

      This property uses state-of-the-art eco-technology, including PV array solar panels and mechanical ventilation heat recovery systems, to produce electricity and substantially lower heating expenses. In addition, investors also benefit from a reduced service charge, making it an attractive option for the increasing number of environmentally conscious tenants.

      Read More: For more property investment insights, check out our guides on how to buy Airbnb property and buying property through a limited company.

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      Reliable Connectivity

      For many tenants, the significance of 4G, 5G, and high-speed broadband rivals that of having access to gas and electricity. While no location is flawless, rural areas often experience less dependable connectivity, and adverse weather can exacerbate these challenges. If you own a property in an area with poor connectivity, it may result in a decline in your house’s market value.

      As a result, buy-to-let investors may want to turn their attention to more urban areas. These areas offer faster 4g and 5g service; some city properties also offer super-fast broadband included in the purchase price. Not only does this satisfy a prospective tenant’s connectivity issues, but it also helps them save money on internet bills.

      For instance, ELEMENT – The Quarter is an eco-property that sits right next to Liverpool’s Knowledge Quarter (home to the Royal Liverpool Hospital and university campuses).

      This development and many other city centre apartment complexes include free Wi-Fi for tenants, among many other alluring facilities, boosting their stock among potential buyers and renters.

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        Good Location

        As we move away from COVID-19 restrictions, many companies are bringing their employees back to the office.

        For that reason, Rolande says, long and convoluted commutes will make living in the countryside less appealing to professionals. This is also due to lower wages in those areas. As more city workers look at urban areas to be closer to jobs, apartments in the city centre will grow in value, while rural homes will see less demand and are more likely to suffer price drops.

        Buy-to-let landlords agree with this sentiment. In a recent study from Shawbrook Bank, most landlords agreed that city centre flats have been and would continue to be one of the best places to buy-to-let due to demand from office workers looking for an easier commute to work.

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          Local Amenities

          Rolande also points to the decline of local amenities in rural areas as a reason why property prices may decline in rural areas. He notes that high streets and pubs in rural locations have suffered following the COVID-19 pandemic, with many residents feeling that these places are no longer the same. This impacts prices and diminishes the desirability of countryside areas.

          In contrast, urban living ensures residents are close to all the local amenities they need. While banks and post offices may close, people can do their banking online. Meanwhile, city centres boast many shops and similar amenities nearby. This ensures residents can quickly get whatever they need, improving urban property’s appeal and helping those investments hold their value over time.

          In short, tenants are more likely to opt for convenience when choosing a property.

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          Convenient Transport

          According to Rolande, the Government’s alteration of HS2 plans stands out as one of the most significant transport debates in decades. The property sector will be closely observing the rollout.

          It goes without saying that the presence of a dependable and efficient train service is crucial for maintaining home value.

          A good local bus or tram service is becoming increasingly important, especially for commuting to work.

          Properties lacking these amenities may find fewer interested buyers, potentially impacting prices.

          For that reason, property investors may want to look to urban areas with good rail and public transport links for some of the best safe property investment.

          While the London Underground may be the first public transport network that springs to mind, other UK cities, like Liverpool and Manchester, boast significant public transport options for locals, connecting different areas within the city and further afield with ease.

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            Which Areas Could See Significant Capital Growth in the UK Housing Market?

            As Rolande’s advice indicates, urban properties are more likely to hold value moving forward. However, property investors still need to consider whether the area offers good value for money.

            For instance, London has a huge economy, excellent transport links and convenient economies. However, the property and rent prices are enormous, even in London’s up-and-coming areas. The HM Land Registry UK House Price Index puts the average property price in London at £901,625. In addition, the HomeLet Rental Index puts the average London rent at £2,127 PCM.

            In addition, the Savills Residential Market Forecast predicts that London will see the lowest capital growth of any region in the UK, totalling 13.9% between now and 2028.

            For these reasons, buy-to-let investors are looking elsewhere to secure better-value properties. One such place is the North West, where cities like Liverpool and Manchester offer a wealth of job prospects, world-class university options and substantial regeneration potential.

            Not only do these cities appeal to a wide demographic of people due to good transport links, advantageous location and plenty of local attractions, but they also offer good-value properties.

            In particular, Liverpool has an average property price of £177,076, while the average rental price is £1,102 PCM, which is much more appealing than the astronomical rental figures in London.

            Also, Zoopla puts the average rental yield in Liverpool at over 7%, meaning apartments for sale in Liverpool could see high returns compared to the national average. Meanwhile, Savills predicts that the North West buy-to-let market will be one of the few residential investment opportunities to surpass 8% (forecasting 9.2%) returns in 2024, further adding to the region’s appeal.

            If you’d like to know more about property investment in specific areas, check out some of our buy-to-let area guides, such as:

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            Author

            Dale Barham

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

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