“Landlord demand for city and town centre property was strong in 2021, with Paragon’s analysis showing completions for house purchases increasing by 100% compared to the previous year,” Richard Rowntree, director of mortgages at Paragon Bank, said.
The strongest increases were seen in locations outside of the UK’s major city centres, according to Rowntree.
Read more: Hamptons: Londoners buy record number outside capital.
“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,” he said.
Milton Keynes experienced a 667% increase in completions in 2021 compared to the previous year. This was followed by Bristol with a 300% increase, Manchester (300%), and Luton (258%).
Other urban locations in the top 10 included Plymouth (183%), Stoke (157%), Northampton (133%), Cardiff (70%) and Nottingham (64%).
Paragon said landlords have been reacting to changing tenant demand, and that is to retain urban living but in smaller towns and cities.
Read more: Zoopla: Rents outside London rising at highest rate for over a decade.
“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,” Rowntree said.
In London, Paragon’s figures show a 95% increase in buy-to-let completions in the capital during 2021, with landlords concentrating acquisitions in Zones 2 and 3 as they balanced the requirement for yield, availability of property, and tenant demand.
