UK commuter towns are hotspots for property investors. These areas have a lower average house price than nearby cities, making entry points more accessible, while still benefiting from the widespread demand for city life. It’s important to note, though, that not every commuter town is going to be worth your money.
To separate smart investments from poor prospects, here are 6 ways to spot potential in UK commuter towns.
1. Prioritise Excellent Transport Links
Commuter towns are prized for their links to the city. Look for towns with direct services and access to sought-after stations or areas.
Top London commuter towns often have a direct service to one of the larger train stations (like Victoria or St Pancras). Reading, for instance, has a 25-minute direct service to London Paddington, and is also serviced by the Elizabeth Line. Slightly further out is Peterborough, with a 50-minute train to London King’s Cross.
Frequency is just as important as speed here. Check how often trains run during peak hours and whether there are reliable off-peak and weekend services. A 30-minute journey every 10 minutes is often more useful than a 20-minute train once an hour.
2. Explore Changes in Local Yields
A smart property investment should be in an area of growth. To separate commuter towns that have already peaked from those that are on the up, carry out research into local yields.
Rental yields measure annual return on rental property investments, taking into account annual rental income and the initial property price.
By using rental yield data to explore how potential returns have fluctuated over time, you can check that prices are steadily increasing. If you spot that yields are stagnating or beginning to fall, it could be a sign of a saturated market.
To dig a little deeper into the data, combine rental yields with other insights, like population increases and employment trends. This will give you a clearer picture of just how stable the commuter town’s growth is and whether the area can keep up with current prices.
3. Compare Affordability With Cities
A major perk of commuter towns is affordability. People specifically choose to live near a city rather than in it so they can access lower property prices and larger homes.
It makes sense, then, that affordability is a key factor in thriving commuter towns.
Of course, there’s a fine balance here. Low prices can make an area more accessible to commuters, but may also indicate less demand. Higher prices, on the other hand, are a good indicator of desirability, but can also reduce your pool of potential homebuyers.
Let’s say, for instance, that you’re considering commuter towns in London. Purfleet-on-Thames is a strong choice for affordability, with an average house price of £248,400 - far lower than the city’s average of over £650,000. It’s also a quick 30-minute commute, making it convenient for people travelling in regularly.
Move slightly further out, and you’ll find areas where house prices begin to rise. Chatham has an average house price of around £280,000, but is around 45-minutes from major London stations. While more expensive, its slightly longer commute is offset by rising demand from those seeking more space and a beautiful, historic town.
For more affordable entry points, look at commuter towns elsewhere in the UK. Bradford is a top pick for Leeds with an average house price of just over £155,000 and a quick 17-minute commute.
Further north, Edinburgh is surrounded by super-affordable commuter towns, including Wishaw (£111,000), Airdrie (£118,000), and Coatbridge (£120,000).
4. Look for Areas of Regeneration
When you’re looking for the best commuter towns in London and beyond, pay attention to areas undergoing regeneration and development. This includes new shopping centres and residential property developments, for example, as well as improvements ot public transport.
Regeneration often signals confidence and long-term investment in an area. Development can attract employers, too, and increase overall desirability for local property markets. Early investors in these towns have the opportunity to buy low and see a high return on investment (ROI), making them financial goldmines.
To find out more about development in a town, check the local council planning portals. Before jumping the gun, make sure any regeneration projects are fully funded and underway; it’s not uncommon for transformations to stall before they get started.
5. Assess Economic Strength
Commuter towns undoubtedly benefit from their proximity to major cities, but a smart investment shouldn’t depend entirely on location. Towns with their own growing economies are often more resilient, particularly as commuting patterns shift and 40% of the UK workforce works from home.
Look for areas that show opportunities within their own walls. A wide range of diverse employers is always a green flag, as are areas with excellent access to education and healthcare. Strong business communities and busy, thriving high streets are major perks, giving your commuter town plenty to boast about.
6. Analyse Demographics
Whether you’re looking for a property to renovate or let, you need to know your target audience. When you’ve found a few commuter towns that could be worth your time, check out the local population to make sure your ideal investment aligns with demand.
For instance, if you’re looking for a low-budget property, like a studio flat, a town that’s popular amongst families might not be your best bet. A commuter town that’s close to the city, though, and has a high student and professional population, puts you in a great position.
To gauge tenant demand, look at:
- The average time different types of property stay on the rental market
- The mix of property types available
- Availability of schools and facilities
- Population growth by age group
You can also speak to estate agents in the area to learn more about the properties that are snapped up quickly at the highest price points.
Final Thoughts
Finding a thriving commuter town in the UK is about more than proximity to a city. Take your time to suss out the hidden potential of an area before diving in, and ensure you’re making a smart move for your property portfolio.
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