Manchester’s M14 postcode — covering Fallowfield, Rusholme, Old Moat and Ladybarn districts — was the most popular location for BTL landlords to invest in 2023, revealed Paragon’s lending data.
According to the research, landlords are attracted to the area by the high student population, as the postcode is located between the University of Manchester and Manchester Metropolitan University.
Landlords investing in this area can achieve rental yields of up to 7.5%.
The second most sought-after area for BTL investment was the B29 postcode in Birmingham, covering the Selly Oak, Bournville, Edgbaston, Kings Heath, Northfield and Stirchley districts, where yields of up to 6.9% can be generated.
Although properties in the Birmingham postcode are the most expensive on the list, the £573,116 average purchase price is skewed by the presence of large, period properties in affluent Bourneville, the model village that was founded by the Quaker Cadbury family for employees at its Cadbury's chocolate factory.
The third most popular BTL hotspot was DH1 in Durham, where properties can deliver yields of up to 7.3%.
Richard Rowntree, managing director at Paragon Bank, said: “Our data shows that portfolio landlords have a strategy of targeting major towns and cities across England and Wales, from Brighton and Hove on the south coast, up through the midlands and Wales and onto Newcastle.
“Something that links many of these diverse areas is their proximity to universities or large employers, such as the NHS or manufacturing and distribution hubs.
“This helps to illustrate the crucial role that the PRS plays in supporting further education provision and the workforce, both vital facets of the UK economy.”
