Property Investment can be highly lucrative and is an excellent way to generate cash flow and grow your capital.
However, as lucrative as it is, it is also highly competitive. If you buy a property where there is limited demand, your property won’t see much price appreciation. Worse yet, your property could be vacant if there is insufficient demand for rental units in the area.
The rise of remote work, increased demand for affordable houses, and the desire for a better lifestyle have prompted a change in the real estate market that investors should be aware of. No town exemplifies this better than Burnley, UK.
Burnley, UK: An Undiscovered Investment Gem
A recent study by PayLess for Storage unveiled Burnley as the UK’s primary property hotspot, noting that properties in the UK sold 58% faster than the national average. The study measured the time between a property being listed for sale and the listing being removed to determine how quickly a property took to sell.
Properties in Burnley are also substantially more affordable than in the rest of the UK. In April 2024, the average home in Burnley sold for £108,000—less than half the national average of £284,000.
Burnley has also experienced a population boom, with the population growing by 8.7% between 2011 and 2021. Furthermore, property prices increased by 37.1% during the COVID pandemic as remote work surged, and people looked for more affordable locations with a better lifestyle.
Investment Takeaways from Burnley
With Burnley in mind, what lessons can be learned for property investors, and if you are planning to get into the real estate market, how can you maximize your return on investment?
- The Migration out of City Centres
With remote work firmly entrenched as part of many business operations, the migration out of city centres looks set to continue for the foreseeable future. There are primarily two main reasons for this: Lifestyle and affordability.
Rural and suburban typically offer a better quality of life than the city, particularly for those nearing the end of their careers or people looking to settle down and build a family. The more people continue to move out of city centres and into rural and suburban areas, the higher property prices and the greater the demand for rental units should be.
However, many of these rural and suburban areas are still a lot more affordable than major city centres.
- Rental Demand is Important
From a Landlord’s perspective, the higher the demand for housing, the easier it is to keep your property occupied. As an investor, it’s important to invest where people want to live.
Whatever the reason for the demand –lifestyle, affordability, or anything else, you don’t want your rental unit to be vacant.
- Price Matters
For many real estate investors, the most challenging investment property to purchase is your first one. Once you get a ‘foot in the door’ with your first investment property, you can continue to build.
With property prices in Burnley being less than half the national average, it is much more affordable to get into the property market. Look for areas that are more affordable yet also have significant demand so your property won’t stand vacant.