Where Is the Best Place to Invest in Property UK? Top 10 Cities Ranked in 2022

On this page, you’ll find a list of the top 10 best places to invest in UK property in 2022. 

We’ve determined our top 10 by taking a data-driven approach and calculated the average property price, latest rental yields and capital growth predictions of the UK’s top 35 biggest cities and towns. 

Our rankings also factor in other important criteria, including urban regeneration potential, employment opportunities, infrastructure, rental demand, opportunities for property investors, and more. 

Let’s get into it: 

2. Liverpool 

Average Property Price: £166,576 

Average Rental Yield: 7.15% 

Predicted Growth by 2026: 18.8%  

Ranked second for capital growth in the UK, Liverpool offers the perfect blend of high property price growth, low property prices, and an in-demand private rented sector. 

A mainstay on anyone’s list of the best and most affordable places to invest in property in the UK, Liverpool has had a similar meteoric rise to Manchester.  

Previously a city suffering from economic decline, UK regeneration has helped transform Liverpool into the economic powerhouse you see today.   

Now: 

Liverpool is one of the most affordable cities on this list, ranked in the top 15 best rental yields areas with one of the highest house price growths out of any city in 2021. 

Factoring in a young city centre population (75% are aged 17 to 29) and rental prices set to rise by 3% in 2022, private landlords can make a top purchase in Liverpool. 

3. Birmingham

Average Property Price: £208,712 

Average Rental Yield: 7.40% 

Predicted Growth by 2026: 15.9% 

If Northern investment isn’t for you, then Birmingham is likely right up your street.  

Credited as the UK’s second city, Birmingham is located in the West Midlands and has all the characteristics needed to be called the best place to buy a house in the UK.  

Birmingham is currently leading the way in rental tenant demand, with Rightmove finding a 51% increase in rental enquiries in 2021. 

The city also has an incredibly young population with about 40% aged under 25 and 64% working-age – 2% higher than the national average.  

It gets better: 

With major regeneration efforts like the Big City Plan and HS2 set to create 80,000 new jobs, average rents will continue to rise, making Birmingham an excellent choice if you want to know where to buy property. 

4. Nottingham 

Average Property Price: £175,822 

Average Rental Yield: 9.49% 

Predicted Growth by 2026: 15.9% 

Home to the UK’s highest average rental yields and equipped with some impressive house price growth, Nottingham is one of the sleeper hits in the UK rental market. 

Described as “fun, funky, and affordable” by the Sunday Times, Nottingham ranks as one of the UK’s best areas to invest in property. 

With affordable house prices nearly £100k below the UK average, Nottingham is well-known for its excellent employment sector. 

Nottingham features over 50 Business headquarters, including Boots and E.ON, plus the likes of Rolls Royce and Midlands Aerospace call the city home.  

Even better: 

13% of Nottingham’s population are students, making a student property investment a top choice in 2022. 

5. Newcastle 

Average Property Price: £180,027 

Average Rental Yield: 8.12% 

Predicted Growth by 2026: 17.6% 

A top UK property investment location thanks to huge returns and low prices, Newcastle is a smart choice for property investors in 2022. 

Boasting the sixth highest rental yields in the UK of 8.12%, Newcastle offers a bustling student population with excellent employment opportunities. 

Home to around 50,000 students in the University of Newcastle and Northumbria University collectively, plus the UK’s biggest modern business park, the income potential is fantastic in Newcastle. 

However: 

Newcastle has struggled with capital growth over the last 12 months, ranked 27th with a price rise of 7.74% – something to consider when choosing to invest. 

6. Leeds 

Average Property Price: £217,725 

Average Rental Yield: 7.61%

Predicted Growth by 2026: 18.8%  

With an average property value of £217,725, Leeds is a bit pricier than other places on this list, but don’t be fooled – this Yorkshire city is well worth its entry price. 

Ranked as 8th for UK rental yields and 6th for capital growth, rental properties have seen huge demand in Leeds thanks to its incredible employment opportunities. 

Boasting the second-largest banking and finance sector in the UK and acting as the largest UK centre for law, Leeds is overflowing with business opportunities in 2022. 

Institutions like Leeds Teaching Hospitals NHS Trust, Jet2, and Channel 4 call Leeds home, which has since attracted thousands of aspiring young professionals.  

Crucially: 

Leeds is also set for historical growth from regeneration, with South Bank Leeds set to double the size of the city centre by creating 35,000 new jobs and 8,000 new homes.  

7. Glasgow 

Average Property Price: £164,382 

Average Rental Yield: 7.56% 

Predicted Growth by 2026: 15.9%

Ranked 9th for rental yields and 13th for capital growth, you might be scratching your head on why Glasgow appears on this list. 

Well, this Scottish city is a perfect example of why average stats don’t tell the whole story, with Glasgow offering an incredible investment opportunity in 2022. 

Boasting the largest economy in Scotland and the fourth-highest in the UK, Glasgow has a rapidly expanding population of young professionals and students – with over 60,000 of the latter. 

The future also looks bright for Glasgow with expansions to its transport links, including a “game-changer” metro system to accompany the subway that loops around the city.  

This sets up an excellent basis to start your investment now before prices grow even higher in the near future.  

8. Middlesbrough 

Average Property Price: £139,750 

Average Rental Yield: 5.55% 

Predicted Growth by 2026: 18.8% 

We thought we would throw a curveball in this ranking with a city you may not have thought about. 

And you might be thinking: 

5.55% yields? That’s not special. 

And you’re right, it isn’t – but that’s not why Middlesbrough has made our list. 

Instead, this North Yorkshire town boasts by far the highest capital growth in the UK, with prices rising by 20.09% over the last 12 months – 6% higher than second-place Liverpool. 

Now: 

Investing just for capital growth is incredibly risky, as there is simply no way to guarantee that your house increases in value – nor are we suggesting you should do this without the income to back it up. 

However, we thought it was well-worth mentioning, with the potential to earn a mind-blowing return on your rental property – just make sure you choose an investment property with the average rent needed to sustain an investment.  

9. Preston 

Average Property Price: £147,108 

Average Rental Yield: 9.20% 

Predicted Growth by 2026: 18.8% 

It’s easy to fall into the trap of focusing on the UK’s biggest cities for a rental investment, but dig a little below the surface, and you’ll find some absolute property gems. 

Chief amongst these is Preston, which has some of the best property statistics in the world – no, seriously, it does. 

This city in Northern England may not get the attention of London, Liverpool, or Manchester, but its underlying stats suggest it should. 

Not only does the city boast highly affordable property, but it has the second-highest rental yields and third-highest capital growth in the UK – with prices rising by 12.73% in the last 12 months.  

It gets even better: 

With huge regeneration efforts ongoing, including a £435 million infrastructure development, the future looks bright that Preston will continue to see rising demand and capital gains in 2022 and beyond. 

10. Newport 

Average Property Price: £219,465  

Average Rental Yield: 8.73% 

Predicted Growth by 2026: 18.2% 

Cardiff is probably the first city to jump to mind whenever you think of property investment in Wales. 

And while the capital is an excellent choice, a Welsh city you may not have considered is Newport. 

Not to be confused with Newport in Shropshire or the Isle of Wight, Newport is the third-largest city in Wales and benefits from an excellent location just 12 minutes from Cardiff via the M14. 

Almost £25k cheaper than property in Wales while offering the UK’s third-highest rental yield, Newport may be the perfect choice for Welsh landlords in 2022. 

The city was also rated as the third best place to live in the UK in 2019 by Adzuna, thanks to the job vacancies and salaries offered – a positive sign for any potential property investors.  

Best Areas for Capital Growth  

Middlesbrough, Liverpool, and Preston are the best places for capital growth in UK 2022. 

These cities have future growth predictions of 18.8% by 2026 while also offering high capital gains over the last 12 months, with prices rising between 12-20%. 

Look at the table above to see how the UK’s 35 biggest cities and towns ranked for capital growth.

Best Rental Yields in UK 2022 

Currently, the best rental yields in the UK in 2022 are in Nottingham, Preston, Newport, which show returns of 8.73% to 9.49%. 

Look at the table to see the best rental yields in UK 2022 out of the most popular 35 UK towns and cities: 

So, Where Is the Best Place to Invest in the UK? 

So, where exactly is the best place to invest in the UK? 

The boring answer is that it entirely depends on your goals and budget. 

For instance, if you’re just focused on income, Nottingham, Preston, and Newport may be the best places to invest as they have the highest UK rental yields. 

On the other hand, if you’re looking for long-term capital growth, then Middlesbrough, Liverpool, and Preston will be the best place to invest in property.  

However, it rarely works out like this because these are just city averages. 

The reality is that you aren’t investing in the average stats of a city.  

Instead, you will be investing in a specific investment property that can offer completely different returns than a city-wide average.  

This is why we also considered other contributing factors in our rankings like rental demand, affordability, and future regeneration, as these are all vital to consider for the future success of your investment property. 

So, what’s the bottom line? 

While stats are helpful, they shouldn’t be your only reason to invest in a specific city. You should consider this list as a good starting point while assessing the investment opportunities in each city and finding one that matches your goals. 

About Our Data

The statistics used in this list were calculated by our writers and came from various sources. 

Property price predictions were taken from Savills’ regional house price growth predictions 2022-2026. 

Average rental income was taken from Zoopla’s database. 

And average house prices were taken from the UK House Price Index. 

Best Up and Coming Locations? 

While they haven’t made the cut yet, the following towns and cities should be considered for the future. 

Although their stats may not be as good as the 10 mentioned on this list, the potential for growth and upcoming regeneration means they could be in the coming years. 

The best up and coming locations vying for the title of the best place to invest in UK property are: 

• Luton 
• Slough  
• Derby 
• Bracknell  
• Cardiff 

These towns and cities have substantial ongoing regeneration efforts and could soon have the property stats needed to make this list in the near future. 

Watch this space… 

What Property Investment Strategy Should You Choose? 

It’s all well and good investing in an area, but it could all be for nought if you don’t choose the right strategy. 

With this in mind: 

What is the best property investment strategy you should choose? 

Well, if you’re thinking of buy to let, likely the best investment strategies currently are: 

1. Residential property investment – The typical form of UK property investment is where a buyer will purchase a home or apartment and rent to tenants. 
2. Student property investment – Like residential buy to let, except student investors will only rent to student tenants. They can do so through purpose-built student accommodation or HMOs. 

But what’s better? 

This will entirely depend on your goals, with residential property offering higher capital growth while student investments are better for income-focused buyers. 

You can learn more about this by reading our list of the top 10 property investment strategies in 2022. 

Alternatively, you can read our specific guides on student property investment if you’re keener on that.  

Who Is RWinvest? Real Estate Investment UK Experts 

If you’re looking at buying rental property in the best areas to invest in real estate, RWinvest has got you covered.  

So why invest in property with RWinvest? 

• We’re an award-winning property investment company named the best property business in the North West 2020.  
• We’re specialists in residential and student property, with over 17 years of experience.  
• We offer exclusive property opportunities that allow you to invest with just £34k.  
• We have an immaculate track record of delivering properties on time, on budget, and fully tenanted.  
• As of 2022, we now have over 1,000 five-star reviews.  

If you want to invest with the best and secure a world-class off-plan investment, choose RWinvest for your next property investment.  

Alternatively, if you want to learn more about investing, we have tonnes of content on our website:  

• property prices after Brexit 
• Best property investment books,  
• Best places to retire 
• How to write a property business plan 

We even have reports on the best places for investment: 

• Liverpool property investment guide. 
• Manchester property investment guide. 
• Leeds property investment guide. 
• Sheffield property investment guide. 
• Edinburgh property investment guide. 
• Birmingham property investment guide. 
• Nottingham property investment guide. 
• Newcastle property investment guide. 

In addition, we have guides on exciting up and coming investment areas. For content like that, check out our beginner’s guide to Wigan property investment in 2022 and our Slough property investment guide. 

Disclaimer: This guide was written in Q1 2022. Depending on when you read, data may be outdated and no longer accurate. Always do your own research to get the latest figures.