The property market in the North East of England is experiencing a surge of interest, and recent forecasts indicate that it’s set to be one of the UK's top-performing regions over the next few years. For anyone considering property investment, these predictions are both timely and encouraging. According to real estate firm Savills, the North East's residential property market is poised for significant growth, with both mainstream and prime properties expected to rise in value by 2027.
This growing interest in the North East has been fuelled by a combination of factors, including strong economic growth, an increasingly skilled workforce, and better-than-average affordability compared to the rest of the UK. For investors, whether local or international, these elements make the North East a promising region to consider. But what exactly is driving this growth, and why should investors be paying attention?
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A Closer Look at the Numbers
Savills’ recent forecast presents a bright future for property in the North East, especially when compared to other regions across the UK. Here are the key takeaways:
Mainstream property growth: Mainstream properties, which account for the majority of housing in the UK, are predicted to increase in value by 11.7% in the North East over the next five years. This is a joint-highest figure across the UK, demonstrating the region’s strength in residential property.
Comparison with the national average: In contrast, the UK average growth for mainstream properties over the same period is expected to be 6.2%. The North East’s predicted rise of 11.7% puts it well ahead, underscoring its growing importance as an investment hotspot.
Strong growth in 2026 and 2027: According to Savills, the most substantial growth is forecasted for 2026 and 2027, where property values in the North East are expected to increase by 7.5% and 6.0%, respectively. These figures represent the highest projected growth for any UK region during this period.
Rental market expansion: The forecast also includes good news for rental property investors. The value of the UK rental market is expected to rise by 18.3% by 2027. With more people renting long-term, this offers an opportunity for buy-to-let investors to capitalise on increasing demand for rental properties.
Why Is the North East Outperforming?
Several key factors are contributing to the North East’s impressive property market growth, making it an increasingly attractive region for investment:
Economic growth: The North East is home to one of the fastest-growing economies in the UK. With expanding sectors like technology, manufacturing, and renewable energy, the region is attracting significant investment and creating a highly skilled workforce.
Affordability: Property prices in the North East remain some of the most affordable in the UK, especially when compared to the South East and London. This affordability makes the region appealing for first-time buyers and investors looking to achieve higher yields.
Connectivity and infrastructure: Major cities like Newcastle and Sunderland offer excellent transport links, both within the UK and internationally. The region’s infrastructure improvements, including projects such as the dualling of the A1, are helping to boost its attractiveness to businesses and residents alike.
Education and workforce: The presence of top universities such as Newcastle University and Durham University ensures that the region has a steady influx of skilled graduates, making it a hub for industries looking for talent. This, in turn, drives demand for housing and rental properties.
The Rental Market Opportunity
For those interested in buy-to-let investments, the North East presents an appealing option. The region’s rental market is growing rapidly, fuelled by an increasing population of young professionals, students, and families. With the rental market projected to grow by 18.3% by 2027, investors can expect to see strong demand for rental properties, especially in major urban areas like Newcastle, Gateshead, and Sunderland.
Additionally, the yield on rental properties in the North East tends to be higher than in other parts of the UK. This is due to the relatively lower property prices, combined with strong rental demand, making the region particularly attractive to buy-to-let investors. For example, in certain parts of Newcastle, rental yields can exceed 7%, a figure much higher than the national average.
What This Means for Investors
Investing in the North East property market offers an opportunity for significant capital appreciation over the next five years. With predicted growth of 11.7% by 2027, the region is set to outperform much of the UK, offering higher returns for both residential and rental property investors. For those looking to enter the market, the time is ripe to capitalise on the North East’s potential.
However, while the growth predictions are promising, it’s essential to remember that property investment always comes with some level of risk. Factors such as interest rate changes, political instability, or global economic downturns could impact the market. That’s why it’s crucial for investors to seek professional advice and work with experts who understand the nuances of the North East market.
Why Choose Clarice Carr & Co?
At Clarice Carr & Co, we specialise in helping investors navigate the North East property market. Whether you’re looking to invest in a buy-to-let property, purchase a family home, or explore commercial opportunities, our experienced team is here to guide you every step of the way. With our deep knowledge of the local market, we can help you find the right investment to meet your financial goals.
Want to know more? Check out our website or get in touch.
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