If you are thinking about investing in property in the UK, Bristol could be a great location. Our guide will give you all the basics for Bristol property investment, including investment strategies, pros and cons of investing in property in Bristol, insider tips, and expert advice. This guide is organised into several sections, which include:
- Why Invest in Properties in Bristol?
- Understanding the Bristol Property Market
- Where to Find Investment Properties in Bristol
- Benefits and Risks of Investing in Bristol Property
- How to make money by investing in Bristol Property
Why Invest in Properties in Bristol?
Fast-growing economy
Bristol boasts a local economy worth £32 billion per year, with a predicted growth of 3% over the coming decade. This translates to a higher demand for housing as well as commercial properties. Major players such as Airbus, Ovo Energy and Rolls-Royce call Bristol home, cementing the city’s status as a fast-growing tech hub. Technology firms in Bristol raised over £220 million in 2022, making it one of the most successful cities in Europe for tech-focused investment. Employment is also 6% higher than the UK average, and 80,000 jobs are expected to be created in the city by 2036. These stats, paired with an encouraging 60.6% survival rate for startup businesses, make Bristol a hotspot for professionals and innovators, which boosts the demand for housing further.
Highly Desirable Place to Live
Bristol has an undeniable ‘cool’ factor which attracts young people to come and study in Bristol. Students often stay after graduating thanks to the thriving cultural scene, plus strong job prospects. Bristol has been named the best city to live in multiple times and Europe’s trendiest city by National Geographic in 2018 and it’s not hard to see why. Venues like the Bristol Old Vic Theatre and the Bristol Beacon, along with independent music and arts venues, enrich the city’s cultural fabric. The famous club Motion was rated as the 11th best club in the world by DJ Mag in 2019 and hosts the In:Motion 12-week-long music and dance event. There are also strong transport links in Bristol, both locally and nationally with a train to London taking around an hour and a half. Bristol is a highly walkable city which appeals to students and young people in general and has been named the UK’s most sustainable city.
Rich History and Culture
Bristol’s blend of rich history, cultural vibrancy, artistic heritage, and a thriving tourism sector creates a great environment for property investment. The Isambard Kingdom Brunel-designed floating harbour as well as other historic buildings add to the city’s heritage. Bristol has many art galleries and museums for the culturally inclined, including the Bristol City Museum and Art Gallery and other cultural hubs like Spike Island. Modern art continues to thrive in the city, which is home to world-famous street artist Banksy. This vibrant street art scene, particularly in areas like Stokes Croft, contributes to the city’s unique character and appeal, potentially increasing property values in these areas. The music scene is just as vibrant, in fact, Bristol was named the ‘most musical’ city in the UK by PRS for Music in 2010. Bristol’s tourism sector, contributing significantly to the local economy and employment, shows the city’s growing popularity. The high visitor numbers to museums and cultural sites, even during restricted periods, indicate a steady interest in the city, which can translate into a higher demand for short-term rentals and residential properties.
Rising House Prices
Bristol’s property prices have increased by almost 300% since 2000, and continue to increase at an impressive rate, even faster than London. This growth in property values indicates a robust and appreciating market, offering investors the potential for significant capital gains. Specifically for Bristol, there’s a forecasted house price growth of 17% between 2023 and 2025. Bristol boasts one of the top 25 highest-yielding postcodes in the UK. For instance, the BS2 postcode, covering areas like St Agnes and Kingsdown, offers rental returns of over 6.18%, with an average property price of £322,531 as of May 2023. Bristol has been facing challenges with housing supply for a while, with over 16,000 applicants on the Bristol City Council’s Housing Register. This shortage in supply, coupled with continued demand, is likely to support ongoing increases in both property values and rental rates. The council does have plans to provide more affordable homes but the current imbalance between demand and supply is expected to continue for the foreseeable future, which means steady growth in rental yields and property values.
Understanding the Bristol Property Market
Before taking the leap to invest in this culturally vibrant city, you should take the time to fully understand the property market in Bristol. Familiarise yourself with the intricacies of the Bristol property market and the area in general, keep updated on the latest news, and seek advice from experts in the local property market before investing.
Market Analysis
The JLL Cities Index shows that the price of new builds in Bristol has risen by a dramatic 20% in the last 5 years, and rental growth for one-bedroom flats grew by a massive 25%. Zoopla’s latest figures indicate that the average sold price for a property in Bristol in the last 12 months was £396,271, and a detached property average price was £547,926.
House prices in Bristol might be quite high compared to other UK cities, especially those in the North, but that doesn’t mean that Bristol isn’t a good area for property investment. Its growing population and economy paired with the rising need for housing in the area could be in your favour. The housing market does seem more stable than in other areas of the UK, resisting the reduction in house prices in recent months and showing some modest growth despite the cost of living crisis and higher interest rates. House prices in Bristol actually did not fall as much as in other areas during the recession of 2007. Houses for sale in Bristol tend to stay on the market for around 51 days, 6 days less than the national average. Rental yields in Bristol do vary by area but sit at a respectable 4.5% as a whole.
There are plans to build on previously abandoned or unoccupied sites such as the Brabazon neighbourhood housing development on the former Filton Airfield, which is under construction at the time of writing and completion is expected in 2024. More growth is predicted, with an estimated 33,000 new homes by 2036.
How to Find Investment Properties in Bristol
You must take the time to come up with a strategy and perform detailed research to find the right investment properties for you in Bristol. Here are some essential steps that will help guide you on your journey towards those lucrative investment opportunities in this vibrant city. Much like any other investment, seeking advice from local experts, doing your due diligence, and deciding on your investment goals beforehand will help pave the way for your success.
Clarify your investment objectives
The initial step in your investment journey is to clearly define your investment objectives. Are you seeking properties in Bristol that will generate steady rental income, or are you more interested in properties that will appreciate over time? Consider whether you have enough funds allocated for any potential renovations. Also, assess your financial strategy: are you planning to invest using a mortgage, or do you have cash reserves at the ready? Thinking about these things in advance will help you identify the most suitable properties for investment, and enable you to make well-informed decisions.
Make useful local connections
Develop connections with seasoned estate agents who have expertise in the Bristol property market. These professionals can offer you crucial insights, aid in locating suitable properties, and handle negotiations on your behalf. Additionally, establish ties with property wholesalers who focus on uncovering discounted properties in Bristol that might not be advertised on conventional platforms. Their expertise could lead you to discover unique opportunities that might otherwise be overlooked.
Know where to look
Check out online platforms, property websites, and real estate portals to explore investment properties. These resources can help you to tailor your search based on various criteria, including price range, type of property, and specific locations within Bristol. Additionally, these platforms provide access to extensive property listings, offer visual insights through photographs, and supply valuable information about each property, helping you make more informed decisions.
Do your research
Take the time to do your research into Bristol’s property market and keep abreast of any new developments. We have selected some areas below that are hot in the investment market right now, but a savvy investor must conduct their analysis independently before parting with their money.
Top Locations for Investment Properties in Bristol
City Centre
Dwelling within the city centre is desirable for younger folks who can choose between trendy conversions of old office blocks or factories and traditional townhouses as well as modern apartments. Hotwells to the west of the city boasts those super-hip multicoloured terraced houses which are hugely popular. Bristol’s City Council has invested heavily in the area over the past 10 years or so, making for a mix of high-end and more affordable homes. This area is ideal for young people and students who want to be right in the middle of the action, plus an easy commute to the University of Bristol.
Average property price: £412,009
Average rental yield: 5.81%
Clifton
This affluent residential suburb of Clifton surrounds the iconic Clifton Suspension Bridge and offers plenty of green spaces as well as upmarket bars, restaurants, independent shops and other amenities of central Bristol. This area boasts grand Georgian townhouses as well as 18th and 19th-century terraced rows and trendy mews. Clifton is also close to many historical landmarks and tourist attractions such as the Giant’s Cave, Isambard Kingdom Brunel’s SS Great Britain, and Clifton Observatory. This is an ideal area for young professionals and buy-to-let landlords, plus short-term lets for visitors.
Average property price: £552,370
Average rental yield: 3%
Knowle & Knowle West
Knowle & Knowle West is an up-and-coming residential area that was created in the 1930s as a council housing estate with green areas included for the health and well-being of the residents. South-east of Bristol city centre, Knowle & Knowle West is a popular area for young families and is full of Victorian and Edwardian terraces with a surprising amount of garden and garage space. Knowle dwellers can enjoy convenient local amenities and transport links that make it easier to get into the city centre or to Temple Meads train station. Knowle is an area primed for gentrification, making it desirable for would-be property investors.
Average property price: £354,398
Average rental yield: 4.4%
Southville
On the south bank of the River Avon across the water from Spike Island, Southville is a trendy area recently gentrified in the 1990s and is full of character and charm. This area is home to some of Bristol’s well-known street art, independent shops, restaurants and bars, as well as a genuine community spirit. Southville is an easy walk from Bristol city centre and is popular with young families, creative types and young professionals.
Average property price: £402,182
Average rental yield: 4.9%
Bishopston
The suburb of Bishopston is located to the north of the city and boasts a variety of large Victorian terraces and semi-detached houses, which are popular with growing families as well as students looking for shared houses. Based around Gloucester Road, home of Bristol’s popular indie shopping district, dwellers can enjoy a traditional local High Street feel within the city. The centre of Bristol is within walking distance, but there are also many local train stations, bus routes and cycle paths nearby. House prices are high in this area but rental yields are generous, possibly as a result of HMOs for students and young people.
Average property price: £586,332
Average rental yield: 6.1%
Benefits and Risks to Bristol Property Investment
High property prices
The property prices in Bristol are high compared to other cities, especially those in the North, which may give pause to a lot of potential property investors. There are still some affordable properties to be found, however, although they may require a little renovation work. Bristol still offers a more stable environment for property investment than other Southern cities such as London. High property prices also mean that the area has a strong demand for rental properties.
Slower rate of growth
While there are plenty of reasons to invest in this impressive city, you may not experience such a drastic return on your investment when compared to that of Northern cities. Many people are moving up North, drawn by more affordable living costs and a rapid rate of growth. Businesses feel the pull of the Northern Powerhouse too, and many are shifting operations to cities like Manchester. You can still expect to see a modest and stable return on your investment in Bristol properties too, however.
Increased rental demand
Bristol’s high levels of employment, steady increase in population, and undeniably hip reputation mean a lot of potential tenants. Long-term shortages in housing in the area mean that a lot will be invested in property development for years to come as Bristol attempts to catch up with its housing shortfall. There’s certainly no shortage of people looking for homes to buy or rent in Bristol. The city’s popularity with tourists also offers potentially lucrative opportunities to those who want to get into the short-term let investment game.
Large student population
Bristol is a popular student city, which welcomes around 64,000 students to UWE Bristol, the University of Bristol and other local colleges annually. The University of Bristol is planning a new campus in the Temple Quarter worth £400 million which could increase student numbers by 30%. A steady influx of students makes for high rental yields and increasing opportunities for investment.
Legal considerations
To let property in Bristol, you will need a licence to do so under their property licensing scheme. Also, some properties may fall under a different jurisdiction than you might expect – some buildings that are located close to Bristol city centre could fall under the South Gloucestershire or Bath & North East Somerset council areas. Always thoroughly investigate local laws and regulations that pertain to property and lettings.
How To Make Money By Investing in Bristol Property
Finding the ideal investment properties in Bristol involves a blend of forward planning and essential local knowledge. Follow these key steps to navigate your way to discovering investment opportunities within this popular city. Building local connections, defining your investment goals, and thoroughly understanding the city’s particular characteristics are crucial to establishing a strong foundation for your investments.
Define Your Investment Goals
First, determine your strategy for investing in Bristol’s property market. Your options include buying property to sell it later as it increases in value, investing in properties in need of refurbishment with plans to sell at a higher price, or acquiring properties to offer for rent. Creating a detailed plan before taking any action is vital, and will help you stay focused on your goals and avoid making hasty decisions.
Research the market
Investing without a deep understanding of the market is risky, so thoroughly research the Bristol property market before committing your resources. Explore different areas of Bristol repeatedly and seek guidance from experienced professionals in the field. Remember, research is a continuous process; the property market is dynamic, and staying informed about its evolving trends is crucial for successful investing.
Cultivate local connections
Get involved with the estate agent community in Bristol. Networking with local experts can lead to insights about potential lucrative investments and warnings about possible risks. Cultivating relationships within Bristol’s property sector could open doors to exclusive deals or properties that aren’t publicly listed, giving you an edge in the competitive market.
Stick to your budget
Decide on a realistic budget early on in your investment journey, accounting for essential renovations or legal expenses, and make sure to stick to it. It’s easy to get carried away and overshoot your budget. Be mindful of this and keep a reserve for unexpected costs. It might be some time before you see a significant return on your investment into Bristol properties due to high initial costs, but be patient and frugal; it will pay off in the long run.
Stay positive and adopt a growth mindset
There will always be unseen complications that may make property investment seem too risky, but adopting a positive mindset and a good attitude will enable you to see past obstacles to your long-term goals. Take any setbacks as valuable lessons that you can learn from, and be open to all potential opportunities. Surround yourself with optimistic, successful people and cultivate that mindset within yourself too.
