Buy-to-let investors seeking the best returns should look at investing in key northern cities where the gap between asking and achieved prices is narrowing.
Regional cities like Manchester and Birmingham are increasingly skewed towards sellers, as strong demand from buyers continues to place upward pressure on house prices.
Graham Davidson, managing director of buy-to-let specialist, Sequre Property Investment, said: “As expected, key northern cities are dominating UK growth.
“Manchester and Liverpool have remained among the strongest contenders with other cities such as Nottingham and Birmingham also among the top areas for property growth.
“For buy to let investors, these [northern cities] are the cities to be looking at over the next 12 months.”
Cities in the south are experiencing the opposite trend, which is why many buy-to-let investors are currently refraining from buying property in London and other southern cities.
Listing prices across London have experienced greater levels of discounting, averaging now at 4% compared to 0.5% in 2014. Discounts of up to 10% were registered in inner London, where property price falls are occurring.
This means that the capital is increasingly becoming a buyer’s market despite its weak 1.8% growth rate, according to property market analysts at Hometrack.
Davidson continued: “Those who haven’t already moved away from the London market are advised to act quickly – not only have the rental yields remained virtually non-existent, but capital growth is also declining.”