The south-east of England is the UK’s biggest region, with the largest population and the largest economy of any region. That means the south-east has huge potential for property investment. In this report we’ll look at some of the main towns and cities in the south-east property investors could consider.
One of the biggest reasons for investing in south-east buy to let is its proximity to London… without actually paying London prices. Historically, as prices have risen in London they’ve rippled out to other towns and cities of the south-east, offering good profits for investors.
Many parts of the south-east fall within the London commuter belt. Anywhere that is commutable from London can offer investors attractive buy to let returns.
The south-east isn’t just about London though. The south-east is one of Europe’s fastest-growing and most prosperous areas with the second-largest regional economy in the UK. Many south-east towns and cities have successful economies of their own and many internationally-significant businesses offering highly paid jobs that support the housing market. Key industries in the south-east include ICT, pharmaceuticals, biotech, healthcare, high tech engineering and aerospace.
House prices in the south-east are the highest in the UK outside London. Right now, the average house price in the south-east is around £323,000 according to HM Land Registry figures. The south-east is still a much cheaper investment than London, where the average price is over £472,000.
South-east property price rises have slowed recently though and actually fell by 0.3% last year according to the statistics. So now could be a good time for investors to find a bargain in the south-east property market.
It is still possible to find places in the south-east where house prices are well below average. For example, some cheap property hotspots include Luton with an average price of just £233,007, the Medway towns at just £239,113 and Crawley at only £278,135. Keep reading our report for more details.
The south-east benefits from huge rental demand including from locals, those coming to work from other parts of the UK and from abroad, and from those unable to buy because of high south-east property prices.
Above-average purchase prices here are made up for by above-average south-east rental incomes. According to HomeLet figures, landlords earn on average £1,023 a month from a south-east buy-to-let property.
Rents are also rising fast in the south-east, which is good news for landlords and investors if not for tenants. This report quoting Hamptons International says that rents in the south-east rose 4.1% last year, double the national average rise of around 2%.
Here’s our guide to property investment in some of the key towns and cities of the south-east of England.
Population: 8.7 million approximately
Average House Price: £472,232
London is the trickiest place in the UK to find the best areas for buy-to-let. That’s not just because it is the most expensive part of the country for property prices. It is because London is not just one property market but many property markets.
Take a look at this report if you would like to discover the best areas of London to invest in buy-to-let.
Average House Price: £367,663 (Brighton & Hove)
Brighton offers residents and investors the best of all worlds – the sea, countryside, city amenities and lots of jobs – while also being close to London... yet far enough away. That makes Brighton one of the highest-priced locations in the south-east.
But, for savvy investors who are willing to shop around, there can still be good deals to be had. This report tells you more about the best areas of Brighton to invest in buy-to-let.
Brighton yields are likely to be in the region of 4%.
Average House Price: £345,217
Chelmsford was granted city status in 2012. The new city is now a hotspot for economic and housing development and there are development plans aimed at establishing Chelmsford as a major regional hub. Key employers are in financial services, science and technology.
Chelmsford is also becoming more and more popular with London commuters, and particularly City workers. The journey time to Liverpool Street in the City of London is just 34 minutes.
Average House Price: £278,135
The one-time new town of Crawley has expanded fast in recent years, as new districts have been added to the original centre and Crawley has become established as a major regional centre. The economy here is based on service industries and light industry. The nearby Manor Royal Business District and London Gatwick Airport provide thousands of jobs.
Average House Price: £363,173
Croydon is a London borough and the second largest with a population of 385,000. It is growing fast as a large town in its own right and the population is expected to reach 430,000 in the next few years.
Known for its 1960’s town centre and ‘concrete jungle’ image Croydon is undergoing huge regeneration and the aim is to promote Croydon as a location for grade A office space and for city living. A big plus for Croydon is accessibility: Commuters can reach central London in just 15 minutes from East Croydon railway station with trains running every few minutes.
Average House Price: £441,040
Guildford in Surrey has long been a favourite upmarket commuter location and frequently scores highly in ‘best places to live’ consumer polls. It is also a busy commercial town, home to high profile multinational companies and high tech. and IT companies on the important Surrey Research Park. The University of Surrey is also in Guildford.
Average House Price: £233,007
Luton has lots going for it! While Luton doesn’t have the most fashionable image there are lots of reasons why property investors should consider investing in Luton property: Luton has a thriving economy, is home to a major airport and still has some of the cheapest property in the south-east.
Luton is a growing London commuter spot and a number of reports say that Luton is one of the best buy-to-let locations for property investors, thanks to affordable property prices, strong rents and good demand.
Yields in Luton are around 5% to 6%. This report looks at the best areas of Luton to invest in buy-to-let.
Average House Price: £478,229 (Windsor & Maidenhead)
Maidenhead is a popular and smart residential location for those commuting to both London and Slough. And, when the Elizabeth Line/Crossrail opens central London will be just 39 minutes away. Maidenhead also has its own successful local economy and the UK Vitality Index has ranked Maidenhead as one of the UK’s best towns for economic growth prospects.
Maidenhead already has some of the highest house prices in the south-east, with the average actually exceeding London itself. However, the opening of Crossrail could see property prices here rise even higher.
Average House Price: £299,145
Maidstone in Kent was originally an agricultural town but the economy is now based around light industry and services. Maidstone also appeals to London commuters who want to live in the Kent countryside with good access to the Kent coast, the Channel ports and Europe. The journey into central London takes around 50 minutes – or just 25 minutes from nearby Ebbsfleet International.
Average House Price: £239,113
The Medway towns area consists of the separate towns of Strood, Rochester, Chatham, Gillingham and Rainham. The area benefits from good access via the M2/A2 to the Channel ports and London. The Medway area has below average property prices for the south-east region.
Average House Price: £239,113
Milton Keynes is a fast-growing, commercial powerhouse of a town with its own successful local service industries plus great rail and road links via the M1. This one-time new town has even been ranked in the top five best places to live in the UK! Big expansion is planned for the area. The CaMKOx Arc scheme for several large new towns makes Milton Keynes a place that property investors ought to take a look at while property prices still offer good value.
Milton Keynes investors can earn yields up to around 6%. This post provides more information on the best areas of Milton Keynes to invest in buy-to-let.
Average House Price: £401,624
Oxford is an economic powerhouse with one of the most successful economies in the country. Oxford is a global name in education, research and technology and a report says it is the top UK city for economic success and wellbeing.
Oxford has a fast-expanding population and a hot property market to go with it, making it a highly attractive location for property investment.
Oxford offers consistent yields of between 3%-5%.
In this report, you can find out about the best areas of Oxford to invest in buy-to-let.
Average House Price: £208,047
Portsmouth in Hampshire on the south coast has an economy which is centred around the marine and aerospace industries, especially the Portsmouth Naval Dockyard and BAE Systems Maritime facility. Other significant employers here are financial and business services, light manufacturing, public services, transport and retail.
Partly due to its island-like setting Portsmouth has the highest population density in the UK and is also a low property price location.
See our article on the best areas of Portsmouth to invest in buy-to-let.
Average House Price: £290,281
Reading is the largest settlement in the UK to lack city status. But it is a major commercial centre and a hub for the IT and tech. industries – Reading is sometimes called Europe’s ‘Silicon Valley’. Reading has great accessibility with access to the M4, the Great Western mainline railway and Heathrow Airport. Reading will also benefit from a station on Crossrail/Elizabeth Line. All this helps to make Reading a major hotspot for housing growth, yet still a relatively affordable location for house prices.
See our article on the best areas of Reading to invest in buy-to-let.
Average House Price: £292,864
Slough has a booming economy and big plans for regeneration and expansion. Slough is right on London’s doorstep, yet Slough property is a fraction of the price of a property in London. Slough is a hotspot for industry and commerce and has been named as the best place to work in Britain for two years in a row.
Yields in Slough are a consistent 4% to 5% approximately.
This report gives more detailed information on the best areas of Slough to invest in buy-to-let.
Average House Price: £206,511
Southampton in Hampshire on the south coast is one of, if not the, most important maritime cities in the country. It is Europe’s largest cruise ship terminal and the UK’s second-largest container port – so an important player in the country’s world trade.
Southampton can offer property investors yields up to around 6%.
This report gives more detailed information on the best areas of Southampton to invest in buy-to-let.
Average House Price: £290,592
The seaside town of Southend’s economy is based on light industry and services although tourism is still important. There are a number of major business parks around the town and Southend Airport has been expanded in recent years with plans to develop the area further. Southend is one of the lower-priced property areas in the south-east and is a budget choice for London commuters with the journey taking 45 minutes.
Average House Price: £277,268
Stevenage was established as a new town in the late 1940s with a new build town centre and a number of distinct housing districts. Stevenage benefits from close proximity to the A1(M) and is also on the East Coast Mainline railway. With a journey time of 22 minutes to London King’s Cross and lower than average property prices, it has become more popular with commuters in recent years.
Average House Price: £360,614
Watford in Hertfordshire is just outside the Greater London area but benefits from being just 15 miles to central London with good connections by road (M1/M25) and rail. Watford is a busy commercial town with the headquarters of many large companies. However, it is also a commuter favourite having great links to national rail services, the London Underground and London Overground.
Note: Population estimates are based on information provided by Localstats. Current average asking prices are taken from HM Land Registry data and Zoopla. Buy to let yields by postcode are taken from Totally Money Buy-to-Let Rental Yield Map 2019/2020.