Property investors seeking both high returns and long-term growth potential should look north and look at the opportunities for investing in the North East of England. The North East has transformed from an overlooked region into one of the UK’s most promising investment hotspots. Thanks to strong rental yields, comparatively low property prices, and increasing levels of inward investment, the region now offers a compelling proposition for both seasoned investors and first-time landlords.
Economic Growth and Inward Investment
The NE economy is on a steady upward trajectory. While GDP per head remains below the national average (£24.6k vs. £39.4k), the region has outpaced many others in economic growth, with a real growth rate of 9.4%. That’s backed by impressive foreign direct investment figures: in 2023–24 alone, the region attracted 67 FDI projects, creating over 4,000 jobs.
Major developments like the Teesside Freeport (spanning 4,500 acres) are helping to reshape the industrial and logistics landscape, creating thousands of future-facing roles and increasing demand for housing in and around key hubs. For investors interested in the best places to invest in UK property in 2025, this region is rapidly climbing the rankings.
House Prices and Affordability
From a property market perspective, the North East is outperforming the rest of the country in several key areas. Recent house price growth hit 6.4% in the 12 months to April 2025, the highest regional increase in England. In March, that figure soared to 14.3%, showing strong momentum.
Yet despite this rapid growth, affordability remains a major draw: average house prices are still around £168,000—well below the national average of £286,000 and significantly more accessible than London or the South East.
For anyone seeking affordable property investment in the UK, investing in the North East is hard to beat.
Rental Market and Buy-to-Let Performance
The rental market is equally impressive. Rents in the North East rose by 9.7% over the last year, outperforming every other UK region. This is being driven by increasing demand from a rising population of young professionals, students, and skilled workers. Investors are capitalising on this demand, with around 28% of all property transactions in the region now classified as buy-to-let, the highest percentage in the country. In some areas, such as Redcar & Cleveland, that figure rises to 50%.
What’s most striking is the level of return investors can expect. The North East boasts average gross rental yields of 15.4%, significantly higher than the UK average and well above those found in London, where yields often fall below 5%.
Regional Property Market Comparison
This combination of strong growth, low entry costs, and high returns makes the N. East an increasingly attractive destination for property investors. The region’s performance becomes even clearer when compared directly with other parts of the UK:
Metric | North East | England Avg | London / South East |
Avg House Price | ~£168k | £286k | £660k in London |
House-Price Inflation (12m) | +6.4% | ~+3.0% | London +3.3% |
Rental Inflation (12m) | +9.7% | ~+7.1% | London ~+8.4% |
Gross Rental Yield | ~15.4% | ~6–7% | ~3–5% |
Buy-to-Let Share | 28% | ~10% | 8% in London |
Investing in the North East
This combination of strong growth, low entry costs, and high returns makes the North East an increasingly attractive destination for property investors. Add to that improving infrastructure, a growing skilled workforce, and new commercial developments, and it’s clear that the region offers not just short-term rental income but long-term capital appreciation.
In a housing market where affordability is becoming increasingly strained, and yields are tightening in traditionally popular areas, the North East stands out as a region of opportunity.
For investors willing to look beyond London and the South East, it’s one of the best-value prospects in the UK property market today. Whether you’re targeting property investment in Newcastle, buy to let in Sunderland, or opportunities in Durham or Teesside, the region is brimming with potential..
Next Steps for Property Investors
If you’re considering investing in the North East, here are some practical steps to get started:
- Research Local Hotspots
Focus on areas showing strong growth and rental demand, such as Newcastle, Durham, Sunderland, and Redcar. These locations represent some of the best UK regions for landlords in 2025. Look into regeneration zones like the Teesside Freeport and track inward investment across the N. East property market.
- Connect with Local Agents and Developers
Establish relationships with estate agents and property developers who specialise in buy-to-let North East opportunities. Their local knowledge can give you an edge in identifying N. East UK rental yields that outperform.
- Understand Planning and Licensing Requirements
Each local authority may have different rules for HMOs or buy-to-let properties. Make sure your investment complies with planning and licensing regulations across the North East rental market.
- Assess Mortgage Options
Speak with brokers experienced in the North East mortgage market to find competitive mortgage deals suited to investment properties.
- Consider New-Build and Off-Plan Projects
These can offer modern standards, energy efficiency, and good tenant appeal, especially in regeneration areas supported by property investment opportunities in 2025.
- Run the Numbers
Factor in local rental values, void periods, maintenance, and potential capital appreciation when assessing ROI. Use a regional house price comparison to guide investment choices.
- Build a Long-Term Strategy
Decide whether your goal is income, capital growth, or a blend of both, and structure your portfolio accordingly to take full advantage of investing in the North East.
.By taking a structured approach, investors can take full advantage of the North East’s compelling mix of affordability, rental demand, and economic momentum. The opportunities are here; it’s time to act.
