But as strong demand from foreign investors pushes London property prices higher, even those investors with a healthy amount of capital are locked out of making a purchase.
Experienced investors are now looking elsewhere to capitalize on the current market and according to Platinum Portfolio Builder; the North on England is now gaining greater interest.
Nick Carlile, who is Founding Partner of Platinum Portfolio Builder and has worked in the property construction and investment industry in and around Yorkshire since the age of 16, believes that renewed faith in the market has sparked a surge of interest.
Nick comments:
"Even though a 25% deposit is still required, this is more achievable on a £100k property in the North than on say, a £250,000+ property in the South, where prices are still considerably higher."
According to Carlile, experienced investors are recognising that stagnant house prices and high demand for rental properties from those who can't afford to make a purchase, are making investments more accessible with greater security of a good return.
He said:
"The north, versus the south, offers much greater opportunity to buy more than one property, building a portfolio over a faster period of time.
"If managed correctly, it has the potential to return much higher returns than in the South where yields are often half what is achieved in the North (average gross yield of 8.9% achieved by PPB in the last 12 months)."
"Having made many such investments myself in Yorkshire, I believe investing in property here has many opportunities. Of course, there are thousands of micro-markets in the UK and this is just one, but successful property investing is about understanding these micro markets."
Regional towns and cities in Yorkshire benefit from high yields, robust rental income and strong prospects of future capital growth, offering ideal conditions for those with money behind them or a decent deposit.
Nick comments:
"Capital growth is part of a medium to long term investment, especially in the current market, so rental yield is crucial. Yorkshire offers a secure buy-to-let investment from a more affordable starting point.
"There is more scope to purchase properties with a significant discount; on average we achieve 26% below survey value for our clients with an average gross yield of 8.9%. Typical yields for London are said to be around the 4% mark due to much higher property prices."
Platinum Portfolio Builder has recently seen an 18% increase in the number of clients wanting to invest in the last quarter, in particular from investors based overseas.
Nick concludes:
"There seems to be a distinct improvement and renewed faith with investing in property and 2011/2012 is offering the prime time to do so. During 2010 the discount achieved equalled to over 2 million in equity for the benefit of our clients and shows the strength of such investments in the North of England."
