UK capital appreciation forecast: Which UK cities are the best to invest in?

May 1, 2025

Being a successful UK property investor means looking backwards and forward at the same time.

We know the North of England is leading national house price growth so far in 2025. History also tells us that investing in property close to regeneration masterplan sites or the waterfront is a great way to supercharge your portfolio.

But you also need to look ahead at what’s coming. It’s one thing knowing where the best market is today, and another knowing where is best to invest tomorrow.

Working that out using UK property market insights is the key to investing successfully to maximise your long-term returns.

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UK capital appreciation forecast 2025-2029

2025 has started well, following in the footsteps of a strong 2024. Robert Gardner, Nationwide’s Chief Economist, said: “Mortgage market activity and house prices proved surprisingly resilient in 2024. At the start of [2025], house prices remained high […and] the pace of house growth moved firmly into positive territory, approaching 4%.”

Further mortgage rate reductions and an ongoing imbalance between supply and demand mean that this positive growth is forecast to continue in the future. In the next four-year cycle, analysts are expecting these factors to cause high levels of capital appreciation:

JLL – 19.9% average house price growth by 2029
Savills – 23.4% average house price growth by 2029

That means the earlier you invest in 2025, the higher your potential returns could be.

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What factors should you look for to maximise returns in 2025 and beyond?

We’ve mentioned the boost your investment can get from being close to the water or a regeneration masterplan – but what else should you look for? If you find a location with the following factors, you give yourself the best chance of achieving maximum capital appreciation:

Strong population growth
Low housing supply
Quality local universities
Great connectivity
High-end lifestyle
Outstanding job opportunities

You can find those ingredients in many places across the UK, but two cities in particular have them all and are the best places to invest in UK property in 2025.

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Property for sale in Manchester

Manchester is well-known as a buy-to-let property hotspot for good reason. It’s a vibrant, booming city that has nowhere near enough housing for its growing population, and the City Council estimates that Manchester’s population will have grown by 80,000 people in just 10 years by 2030. In contrast, the Deloitte Crane Survey shows that approximately 11,000 homes are scheduled to be completed by 2029.

That’s a huge gap, and the lack of supply is already having an effect on house prices and rents in the city. Both are growing much faster than the national average, according to the Office for National Statistics in April 2025:

House prices up 6.9% in a year
Rents up 9.5% in a year

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Buy property in Liverpool

Liverpool is another city that is extremely popular with buy-to-let investors from around the world. It’s one of the UK’s best investment locations for many of the same reasons as Manchester:

10% - House price growth in Liverpool in 2024 (Office for National Statistics, Q1 2025)
9.8% - Rental growth in Liverpool in 2024 (Office for National Statistics, Q1 2025)
£3bn economic growth and 60,000 extra jobs since 2017 (Liverpool Combined Authority)

In the future, it is expected to keep growing and continue providing investors with significant capital appreciation because of the following factors:

45,000 – Expected population growth by 2034 (Liverpool City Council)
8,000 – Number of homes planned by 2030 (Liverpool City Council)

It’s a recipe for high returns, and investors can buy in Liverpool with confidence.

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The North West is the UK’s best property investment market

Both are situated in the North West – the UK’s best property investment location, which is the region forecast to grow fastest in the future. Savills says we can expect 29.4% capital appreciation in the North West by the end of 2029, compared to the national average of 23.4%.

That makes it a prime opportunity for anyone who wants to buy UK property, and in particular for anyone looking for buy-to-let property for sale.

Want to learn more about capital appreciation forecasts and what makes UK property such an exceptional investment opportunity? Contact our team today to discover more.

UK capital appreciation forecast: Which UK cities are the best to invest in?

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