Areas of Sunderland: Buy-to-Let Property Investment Hotspots
Sunderland is famous as a city that makes things, with both ships and cars being amongst Sunderland’s most famous manufacturing industries. And, thanks to having some of the UK’s cheapest property, Sunderland could well gain a reputation as a place property investors can make a good return too.
Why Invest in Sunderland?
Sunderland is part of the wider Tyne and Wear region which also includes the City of Newcastle upon Tyne plus Gateshead, North Tyneside and South Tyneside. The City of Sunderland, which is located on the River Wear, has a population of 277,400.
Sunderland’s economy has long been based around manufacturing. Sunderland was once the world’s biggest shipbuilding centre, and is now the UK’s biggest car manufacturing centre.
Thanks to a reputation for making things people from Sunderland are sometimes called Mackems. (There’s even a distinct local accent called Mackem too.)
Other important employers in the area include the public sector, financial, professional and business services, construction and transport including the Port of Sunderland. Smaller but expanding area industries include science, health, marine and offshore services, and the creative and digital sector.
Nissan Motor Manufacturing UK or NMUK is Sunderland’s biggest employer. It manufactures up to 500,000 vehicles a year and is one of the most productive car manufacturing plants in Europe. It directly employs around 6,000 people with over 27,000 more in the supply chain.
Doxford International Business Park is the base for a number of large businesses and around 8,000 people work there in total.
Sunderland has suffered from industrial decline in the past but has also benefited from regeneration projects in recent years. This has seen the old shipyards long the River Wear redeveloped with new uses. A flagship scheme has been the Stadium of Light, home to Sunderland AFC. More recently a new river bridge, the Northern Spire Bridge, has been built to help regenerate the surrounding areas.
Sunderland has a number of Enterprise Zone sites, which are designed to attract new businesses and investment and to help create jobs. These include the A19 Corridor, the IAMP or International Advanced Manufacturing Park, the Port of Sunderland and the new University Enterprise Zone.
More regeneration is planned for Sunderland with a £100m investment in Sunderland Riverside having recently been announced. The plans for Sunderland Riverside are to create a new city centre district and include a new City Hall, modern office space to attract new companies and city centre homes which could double the population of the city centre.
Sunderland has good transport links, making it popular with commuters and for those who travel around the north east region too. It is close by the A19 and A1(M). The Tyne and Wear Metro light rail network connects Sunderland to nearby Newcastle upon Tyne. There are Metro stations at Seaburn, the Stadium of Light, St.Peter’s, the city centre, Park Lane, the University, Millfield, Pallion and South Hylton. There are plans to open up new Metro lines in and around Sunderland too, which could make new areas of the city attractive for investment.
Although an industrial city, Sunderland also has a growing reputation for its theatres, museums and galleries, arts and cultural scene. Some of the area’s best beaches are also in Sunderland’s northern suburbs.
Sunderland is a student city, so student property investors may want to explore the opportunities for student accommodation. The University of Sunderland has around 20,000 students and has recently expanded by setting up a new medical school.
The University of Sunderland has two campuses: City Campus Sunderland and The Sir Tom Cowie Campus at St Peter's. Sunderland students live all around the city but popular student areas for living in Sunderland include the city centre, Millfield, Pallion and Ashbrooke.
Attractions and Amenities
Sunderland offers various attractions and amenities, for tourists and for locals. Here are some of the highlights:
- Beaches: Roker and Seaburn Beaches are both Blue Flag beaches, recognised for their cleanliness and excellent facilities. They offer sandy shores, rocks, and a variety of dining options. Roker Pier Lighthouse is also a notable feature.
- Museums: Sunderland Museum and Winter Gardens showcases the city's history, with peculiar exhibits, tropical plants, and water features. The National Glass Centre celebrates the city's glassmaking history, with daily exhibitions and glassblowing demonstrations.
- Parks: Mowbray Park, voted the best British park in 2008, features open spaces, statues, and a walrus sculpture honouring author Lewis Carroll. Herrington Country Park, a former open-cast mine, offers walking and cycling trails, art installations, and a cafe.
- Landmarks: Souter Lighthouse, the world's first electrically powered lighthouse, offers stunning coastal views. The Penshaw Monument, modelled on the Temple of Theseus, commemorates John Lambton, the first Earl of Durham.
- Entertainment: The Sunderland Empire Theatre, one of the UK's best theatres, has hosted Helen Mirren, the Beatles, and West End productions. The Stadium of Light, home to Sunderland AFC, has also hosted bands like Foo Fighters.
- Sports: Silksworth Sports Complex and Ski Slope offers a range of sports facilities, including a ski slope. There's also the Sunderland Aquatic Centre and the Sunderland Stadium of Light Tour for football fans.
- Art Galleries: The Northern Gallery for Contemporary Art showcases established and emerging artists, providing a platform for their work. There is also the Abject Gallery.
- Other Attractions: Washington Old Hall, the ancestral home of George Washington, is now owned by the National Trust. The Riverside Sculpture Walk reflects Sunderland's past and present, with sculptures along the River Wear.
Sunderland provides a well-rounded experience for visitors and locals, with a mix of cultural, historical, and outdoor attractions.
Property Values
Sunderland house prices are some of the lowest in the UK.
The average property price in the Sunderland area is £133,000, according to data from March 2023 to February 2024. The median price is £103,000. However, one source suggests that the average price in Sunderland is £155,633, while another puts it at £169,000 as of January 22, 2024. This represents a 13.2% rise over the previous 12 months.
The average listing price in Sunderland is currently £170,720, which is down by -1.7% in the last six months. On average, properties in Sunderland spend 14 weeks on the market.
On average 3 3-bedroom houses in Sunderland currently fetch an average of £197,862, while flats average £110,440.
Average Asking Price by Postcode Area
Last updated: August 2024
Data from propertydata.co.uk
| Postcode District | Average Asking Price |
|---|---|
| SR1 | £62,678 |
| SR2 | £164,738 |
| SR3 | £228,816 |
| SR4 | £132,918 |
| SR5 | £127,245 |
| SR6 | £247,645 |
Rental Demand
Sunderland’s buy-to-let market offers landlords opportunities to let to local residents, commuters, and students.
According to the Office for National Statistics, the average rent in Sunderland in March 2024 was £612 per month, a 6.8% increase from March 2023. This is higher than the 6.1% rise in the North East over the same period.
Although Sunderland property prices and rents are lower than the national average, the combination of the two makes some excellent rental yields possible in parts of the city. In April 2024, in the city centre (postcode SR1) rental yields average an incredible 10.1%.
Sunderland has an average rental yield of 7.61%, according to Zoopla. Track Capital reports that the North East as a whole has a slightly lower yield of 5.18%, which is still the second-highest in the UK. This is an improvement from 2023 when the average yield was 4.29%.
Rental demand in Sunderland is driven by a combination of factors, including supply and demand. Firstly, Sunderland has a diverse range of letting opportunities, catering to residents, commuters, and students. Secondly, Sunderland's reputation as a manufacturing hub, particularly in the automotive sector, attracts a steady flow of workers seeking rental accommodations.
Furthermore, redevelopment initiatives such as Riverside Sunderland, aim to revitalise the city by creating homes and jobs and boosting the local economy. This influx of investment and job opportunities is expected to draw more people to the area, increasing the demand for rental properties.
However, it's worth noting that Sunderland tenants may struggle with higher monthly rents as average rents continue to rise.
Average Rental Yield by Postcode Area
Rental yield is the rental return an investor can expect on their investment once costs have been taken into consideration.
Last updated: August 2024
Data from propertydata.co.uk
| Postcode District | Average Rental Yield |
|---|---|
| SR1 | 12.0% |
| SR2 | 4.7% |
| SR3 | 3.4% |
| SR4 | 5.8% |
| SR5 | 6.2% |
| SR6 | 3.4% |
Landlord Licensing
Sunderland City Council requires all HMO landlords to have an HMO license and has Article 4 Directions in place in some areas, which restrict the conversion of standard homes into HMOs. The council does not, in early 2024, run a Selective Licensing scheme although it is worth noting, that the Council are within their rights, as set out in the Housing Act 2004, to bring in a Selective Licensing Scheme at any time, as many local authorities have done over the last few years.
Selective Licensing schemes are not without controversy and require all private landlords to have a license (meaning they commit to certain housing standards). There is currently no such scheme in Exeter but this could change, so it is always worth keeping an eye on the council's website for updates.
HMO Licensing
As is true for all of England and Wales, a licence is required for Houses in Multiple Occupation (HMO) in Sunderland if five or more people form two or more households and share basic amenities such as a kitchen or bathroom.
The Housing Act 2004 enforces a mandatory licensing scheme for certain HMOs, which was extended in October 2018. Sunderland City Council keeps a public HMO register that can be viewed by appointment or electronically upon written request.
Article 4 Directions
Article 4 Directions give local authorities the power to restrict changes of use from single dwellings to HMOs in areas where a high concentration of HMOs may cause problems.
In Sunderland, Article 4 Directions have been applied since December 2013 in the following wards: Barnes, Hendon, Millfield, St. Michael's, and St. Peter's. Outside these areas, changes between Use Class C3 (single dwelling) and Class C4 (Small HMO) do not require planning permission.
The Best Places to Live in Sunderland
Sunderland has a variety of desirable areas catering to different preferences and budgets. Here are some of the best places to live in the city:
- Seaburn: This highly desirable area boasts a prime seafront location with a Blue Flag beach. It offers a mix of 19th-century terraced properties and semi-detached houses. Seaburn has a lively atmosphere with a variety of eateries, amusement arcades, playgrounds, and convenient amenities. It also has a Metro station, providing easy access to Sunderland's centre and beyond.
- Fulwell: Fulwell is known for its vibrant dining and drinking scene, with a wide range of establishments to choose from. It includes the larger ward of Seaburn and offers a mix of housing options. Fulwell is well-connected, with good bus links and the Metro station at Seaburn, making it a convenient choice for commuters.
- Ashbrooke: This sought-after residential area is characterised by wide, tree-lined streets and Victorian-style houses. It is popular among young professionals and students due to its proximity to the University of Sunderland. Ashbrooke also provides easy access to two Metro stations, making it an excellent choice for those who need to commute.
- Middle Herrington: Located in the south of Sunderland, Middle Herrington offers convenient access to the A19, Doxford Business Park, and Sunderland's city centre. It is also close to Herrington Country Park, one of the largest parks in the city, making it ideal for families who enjoy outdoor activities.
- Queen Alexandra Road: This major road in Sunderland offers a range of unique properties, from bungalows to detached homes. It is within the SR2 postal district, one of the most sought-after postcodes in the city, with higher house prices than the Sunderland average.
- Chester Road: Chester Road is a bustling hub with a variety of shops and great transport links, including Metro stations. It provides easy access to the Sunderland Royal Hospital, the University of Sunderland City Campus, and the A1231 towards Gateshead. Most properties on Chester Road are terraced, with a mix of houses and flats available.
- Barnes and High Barnes: These areas are ideal for those who want to live close to the city centre. They offer good infant and junior schools, and convenient access to local shops and Sunderland Royal Hospital.
- Roker: Located near the coast and Sunderland University's St Peter's campus, Roker offers a mix of charming late-19th-century cottages, character terraces, and exclusive detached homes. Some properties even boast a beach frontage.
- Whitburn: Whitburn is known for its upmarket properties with stunning views of the coastline and the Cleadon Hills. It is just three miles from Sunderland's city centre and has primary and Church of England academy schools.
Property Investment in Sunderland
Here’s our guide to buy to let in and around Sunderland:
Sunderland City Centre
Population: 15,000
Average House Price (SR1): £153,417
While Sunderland has a fairly small city centre it has become more popular for city living in recent years thanks to several regeneration projects. More new homes are being planned around the city centre, including at Sunderland Riverside.
Sunderland city centre is generally a good value property area and investors can choose from contemporary and older apartment blocks and traditional terraces. Investors in Sunderland will also find single-storey terraced bungalows which are unique to the area and which are known locally as cottages.
Yields in Sunderland city centre, within the Sunderland SR1 postcode area are up to as much as 10.1%.
North Sunderland Suburbs
Population: 48,200
Average House Price (SR5 and SR6): £109,417 and £236,119
North Sunderland suburbs, across the River Wear from the city centre, include Monkwearmouth, Roker, Seaburn, Fulwell, Carley Hill, the separate village of Whitburn in South Tyneside borough, Witherwack, Southwick, Hylton Red House, Downhill, Town End Farm, Hylton Castle and Castletown.
North Sunderland offers good access to the city centre and also good access to Newcastle upon Tyne by road and on the Tyne and Wear Metro. Roker, Fulwell and Seaburn are particularly popular residential areas as they are close to the coast of Whitburn Bay and its beaches. The suburbs in the northwest are good value areas and offer easy access to the Nissan factory and other employment sites.
Yields here, covered by the SR5 and SR6 postcode areas, are an average of 7.2% and 5.1%, respectively.
South Sunderland Suburbs
Population: 152,000
Average House Price (SR2, SR3 and SR4): £130,397, £168,380 and £118,363
South Sunderland suburbs are those south of the River Wear stretching out from the city centre. They include Pallion, Ford Estate, Thornhill, Hendon, Ashbrooke, Hylton Lane, Pennywell, Humbledon Hill, Plains Farm, Grangetown, Wearside, Farringdon, Thorney Close, Silksworth, Ryhope, Doxford Park and the Herringtons which include New Herrington, Middle Herrington, East Herrington and West Herrington.
The University of Sunderland’s City Campus and the Sunderland Royal Hospital are just to the west of the city centre, adding to the demand for rented accommodation here. South Sunderland suburbs offer good access to the A19 road and employment in the city centre as well as at Doxford Business Park.
Particularly popular residential areas include Ashbrooke and High Barnes which are close to the city centre. Further south Ryhope, Doxford Park and also the Herringtons are family-orientated suburban areas. Investors interested in cheap Sunderland property might consider the large estates around Pennywell, Ford Estate and Hylton Lane.
Yields here, covered by the SR2 and SR4 postcode areas, are an average of 4.8% and 7.2%, respectively.
Other Areas to Consider
Investors who are interested in Sunderland property investments might also look at nearby locations which are separate towns but still part of the City of Sunderland local authority area. Washington has a population of 67,000 and is right on the A1(M) motorway offering good access to Newcastle, Gateshead, Sunderland and further afield. It has good value property and buy-to-let investors in Washington (Newcastle NE37 and NE38 postcode areas) might earn a steady 5% yield.
Houghton le Spring is a one-time mining town to the southwest of Sunderland itself. It is close to the A19 and A1(M) so is popular with those who work in Sunderland, Durham or other places around the northeast. Houghton le Spring is also a good-value property area and yields in the area (Durham DH4 and DH5 postcodes) are around 5.2%.