Private landlords are increasingly targeting smaller, secondary towns and cities, analysis from Paragon Bank has suggested.
Its own lending activity has revealed a strong increase in completions in city and town centre postcodes during 2021, up 100 per cent on 2020.
The strongest increases were outside of the UK’s major city centres. Aside from London and Manchester, the top 10 highest growth locations in urban completions were in secondary towns and cities.
The highest percentage increase was recorded in Milton Keynes, which experienced a 667 per cent increase in completions in 2021. This was followed by Bristol. with 300 per cent more completions in the previous year, Manchester was also up by 300 per cent, and Luton by 258 per cent.
Other urban locations in the top 10 included Plymouth, up 183 per cent, Stoke, 157 per cent, Northampton, 133 per cent, Cardiff, 70 per cent, and Nottingham, up 64 per cent.
In London, Paragon’s figures showed a 95 per cent increase in buy-to-let completions, with landlords concentrating on outer zones.
‘Landlord demand for city and town centre property was strong in 2021, with Paragon’s analysis showing completions for house purchase increasing by 100 per cent compared to the previous year’, said Paragon Bank director of mortgages Richard Rowntree.
‘The strongest growth was not necessarily in the UK’s major cities. Aside from London and Manchester, the top 10 growth locations were in secondary cities or large towns. The likes of Milton Keynes, Luton, Bristol, Northampton and Nottingham experienced strong double or triple-digit growth in completions during the year.
‘There appears to be one of, or a combination of, three factors that each of these locations share. They are in commutable distance to a major city, they mostly have vibrant universities and they have healthy local economies. Landlords have been reacting to changing tenant demand and there is clearly demand for tenants to retain urban living, but perhaps targeting smaller towns and cities’.
