Bristol claims top spot as best city for BTL investment – Aldermore

Aldermore’s Buy-to-Let City Tracker has named Bristol the best city to invest in for 2024.

The Tracker analysed five key indicators that impact buy-to-let (BTL) desirability: average total rent, the best short-term returns through yield, long-term return through house price growth over the past decade, the lowest number of vacancies as a proportion of total housing stock, and the percentage of the city population in the rental market.

With good rental prospects, a high proportion of long-term private renters available and low number of properties currently vacant, Bristol jumped to the top of the leaderboard this year.

Growth on returns was also an attractive lure for landlords, with an annual increase of 6.6%.

However, in Bristol short-term yields sat at 4.4%.

Manchester dropped one place this year from the top spot, although the average rent per room is lower at £461, and the proportion of vacancies in properties is lower at 0.9% compared to the national average of 1.2%.

Long term returns are very appealing for landlords at +6.1% with a healthy market of tenants available (31%). 

Other cities in southern England also provided positive prospects for landlords including Brighton, London and Reading with higher average rents per room and strong demand from renters.

For the first time since the City Tracker was launched five years ago, a Scottish city has entered the top ten with Glasgow now in 8th place.

The city provides good rental returns for landlords at £471 and offers one of the highest short-term returns of 8.6%, higher than the average of 5.5%.  

Jon Cooper, head of mortgages at Aldermore, said: “Landlords have experienced an unprecedented year with rising interest rates, rising inflation, all while navigating their way through property legislation changes.

“Yet, the demand for rental accommodation has never been so high. Landlords play an important role in the UK economy, providing homes for those who are yet to get on the housing ladder or want to rent.”

“Usually, a few regions dominate the leadership board, but this year we see for the first time a wider range of areas making it into the top 10.

“We can see that each region is made up of multiple smaller markets with their own unique conditions and challenges.

“Landlords continue to do their research, working with their brokers to review their portfolios and ensure they are getting the best value for their properties, whatever obstacles may come their way.”