Bristol is a modern, progressive city in the southwest of England, one with a long history of maritime trade that has propelled it into being one of the UK’s most prosperous areas.
The city’s plans to evolve and progress in the coming years, coupled with its commitment to sustainability, make Bristol an interesting and attractive location for property investors wishing to diversify their portfolios. So, let’s take a deeper look and see why this famous port city is becoming a sought-after investment property hotspot.
Overview
Bristol has been quietly flying under the property investment radar for many years, perhaps overlooked due to the affordability of locations further north. But whilst the average property price is higher than most cities in the north of England, there’s still an awful lot of upside potential for investors with the budget available.
First of all, Bristol is a fantastic place to live. It’s a talent hub for the southwest of the country, with over 465,000 residents, 46,000 businesses, two world-class universities, and a mantelpiece full of awards – winning the ‘Most Liveable British City’ award in both 2014 and 2017.
The local economy is flying – quite literally, too. The aerospace industry is a major player in the region, with the likes of Airbus, BAE, Rolls-Royce and GKN all based close by. Naturally, the port is a major source of trade and income, with plenty of big-name manufacturing and engineering companies calling Bristol home. Plus, the city has one of the highest concentrations of tech and finance jobs outside of London.
Altogether, this paints the picture of a progressive city with a solid set of fundamentals to drive continuous improvement in the property market – both in terms of capital appreciation and rental prices.
Why is Bristol a good choice for property investors?
Bristol property prices come in at an average of £400,598 at the time of writing (May 2023, Rightmove). This puts the city well and above some of the more entry-level prices available in the north of the country – for example, Manchester’s average property price is £283,355. Nonetheless, it’s still significantly lower than London’s average price of £669,429.
And that means there’s still enough wiggle room to generate strong rental yields, which any buy-to-let investor should be prioritising. The average rental yield in Bristol is 5.1%.
The yields are driven by steadily increasing rental prices as a result of exceptional demand from students, young families and professionals who either stay in Bristol after graduation or choose to move to the city for work. As a result, there is huge rental demand.
There are over 64,000 students spread across the city’s two main universities (the University of Bristol and the University of the West of England), resulting in a sizeable opportunity for student property investment. Student HMOs are popular near Gloucester Road, in areas like Bishopston, Horfield and St. Andrews. Moreover, PBSA projects are starting to pop up in the city centre to address a critical undersupply at the moment (just 13,000 units).
Savvy investors will know this shortage of units could boost rental premiums for the available units. And, given the student numbers in the city, it will take years for supply to catch up with demand.
In addition, the outlook for the city is positive. It was one of the first to formally recognise the climate crisis, and this has focused all future development and regeneration efforts. Over the coming years, the aim is to create a sustainable, community-focused city with a world-leading, circular economy. To do this, there are several projects planned or already in action:
- Temple Quarter – This area will be transformed into a mixed-use community with 10,000 new homes, 22,000 new jobs, and upgrades to the Temple Meads train station to expand rail capacity.
- Avonmouth Port – Expansions to the port intend to attract even more manufacturing and engineering companies, prioritising those with net-zero models.
- City Centre – The city centre is due for an intensive overhaul, with a City Centre Development and Delivery Plan on the way that will provide the blueprint for the city centre’s transport, commercial, residential, leisure and hospitality infrastructure, in addition to detailing initiatives to meet environmental objectives such as becoming carbon neutral by 2030.
- The council’s partnership with Bristol Energy will invest over £1bn in smart, sustainable energy projects, which will have knock-on benefits for the community (e.g. jobs) and the city’s economic output.
- As these projects progress and the city continues to evolve, they should have a positive impact on the local property market. Getting in now, although more expensive than other cities across the UK, could reap significant benefits for investors in the future.
Top 10 Buy-To-Let Areas In Bristol By Rental Yield
So, which are the best postcodes to consider when investing in Bristol rental property? Using industry data on postcode performance, we’ve identified ten property investment hotspots for buy-to-lets in the local area based on rental yield. Here are the results:
| Postcode | Avg asking rent (pm) | Avg yield |
|---|---|---|
| BS34 | £1,878 | 6.70% |
| BS7 | £2,217 | 6.20% |
| BS16 | £1,827 | 6.20% |
| BS10 | £1,683 | 5.90% |
| BS2 | £1,410 | 5.80% |
| BS1 | £1,484 | 5.10% |
| BS13 | £1,237 | 4.90% |
| BS5 | £1,223 | 4.50% |
| BS4 | £1,259 | 4.40% |
| BS14 | £1,221 | 4.40% |
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BS34 – Filton, Stoke Gifford
BS34 is situated 15-20 minutes north of Bristol city centre and covers the neighbourhoods of Filton, Stoke Gifford and Patchway. Thanks to its fantastic connections to the city, local bars and restaurants, train stations and the University of the West of England (UWE) university, the area is in high demand across a broad tenant demographic which includes young professionals, students and families.
With an annual rental yield of 6.7%, BS34 currently offers the best return for buy-to-let investors. However, it’s worth noting that although the average property here commands a relatively high monthly rent of £1,878, the average house price of £337,533 may prove a barrier to entry for some investors.
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BS7 – Bishopston, Gloucester Road
Bristol’s famous Gloucester Road boasts the claim of having the highest concentration of independent shops and vendors in the UK. The BS7 postcode covers much of this, sitting directly in between BS34 and the city centre, so as you’d expect, it’s a bustling, vibrant area that’s in increasingly high demand. Many of the properties here are large townhouses and Victorian terraces that are either split into separate apartments or combined for shared living and student accommodation.
House prices around Bishopston are among the highest you’ll find anywhere in the city, with an average of £428,893. Even so, rental prices are high enough to compensate, and landlords can still generate a 6.2% yield per year. Perhaps just as attractive is that house prices in BS7 are rising far quicker than most other areas in the city – increasing by 38% over the past five years alone.
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BS16 – Hillfields, Bromley Heath, Cheswick Village
BS16 sits to the northwest of the city centre, offering easy access to the beautiful Snuff Mills Park, the historic Oldbury Court Estate and the popular UWE University. Residents here enjoy the range of scenic walks and leisure activities on offer, making it a very attractive option for buy-to-let investors seeking a balance between urban amenities and natural greenery.
A buy-to-let property in BS16 currently costs £354,602 and, like BS7, will generate an expected yield of 6.2% per year. The close proximity to UWE makes the postcode a popular choice among landlords looking for student accommodation investments, though it’s certainly not limited to this.
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BS10 – Southmead, Brentry, Henbury
With a 5.9% rental yield per year, the BS10 postcode is another attractive option for buy-to-let investors looking for a desirable location with a high demand for rental properties.
Here you’ll find plenty of amenities, supermarkets, outdoor activities and green spaces, including the beautiful Blaise Castle estate. The area has a healthy mixture of family homes, apartments and student accommodation, so there’s something to suit the needs of every buy-to-let landlord.
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BS2 – Bristol City Centre, Kingsdown, St Werburghs
BS2 is a fairly large postcode that covers most of the northern and eastern parts of the city centre. It’s a prime area for buy-to-let property investment that offers lively city living and close proximity to the city centre shops, bars, restaurants and the University of Bristol.
Despite the area being in high demand, house prices here are notably lower than any other postcode in our top 10, coming in at an average of £293,514. This is a great area for investors aiming to buy a modern city centre apartment in particular. Rental income remains strong despite being relative to the lower house prices, with the average tenant paying £1,410 per month.
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BS1 – Bristol City Centre, Old City, Redcliffe, Wapping Wharf
BS1 is the city’s most central postcode, covering the main city centre, the historic wharf area and neighbourhoods directly to the south and west of the centre. Bristol city council has invested heavily in the city centre over the past decade, making it a desirable option for young professionals who work in the city and for students willing to pay for a closer commute to the University of Bristol.
Again, the bulk of investment property opportunities here is modern city centre apartments, though you will find a healthy mix of both modest and high-end options depending on what you’re looking for. Unlike other areas of the city, capital growth and property values here have remained relatively static over the past five years, increasing by just 2% in that time and still sitting around the £350,000 range.
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BS13 – Highridge, Bishopsworth, Hartcliffe
BS13 covers the neighbourhoods to the southwest of the city. It’s an area forecasted to continue developing over the coming 3-5 years, but that offers some fantastic buy-to-let opportunities, including traditional terraced houses and flats. This is where you’ll find the beautiful Ashton Court Estate and the popular Bristol International Balloon Fiesta, offering residents easy access to leisure and cultural activities.
The area is popular among families and young professionals that want to see their money go a little further in terms of space, whilst still enjoying good transport links to Bristol city centre. For investors, it’s a great option for those looking for a convenient location with the potential for further capital growth. House prices here have already risen by 36% over the past five years, and the rise looks set to continue.
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BS5 – Easton, Moorfields, St George East
BS5 is located to the east of the city, covering the neighbourhoods of Easton and St George East. It has good transport links to the city centre and plenty of buy-to-let opportunities with high growth potential in future as the city continues to expand.
Residents, mainly families and professionals, enjoy access to excellent green spaces, including Nethem Park, St George Park and Conham River Park, as well as the conveniently located Lawrence Hill train station. House prices have risen by 37% over the past five years to an average of £329,760, indicating that BS5 is an up-and-coming postcode with room for more capital growth in years to come.
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BS4 – Knowle, Knowle West, Brislington
The high concentration of terraced houses and flats in BS4 is a big reason why many investors are looking at this area for their next investment property. The area is just to the southwest of the city centre, close enough to reach in 30-40 minutes on foot or 15-20 minutes on the bus.
Along with the range of shops, bakeries and local amenities, BS4 is also located near the popular Bedminster Parade, a thriving hub for city dwellers that has seen a huge amount of development in recent years and now offers exciting home developments for young families and professionals. The potential for further house price growth here is a big draw for investors, and the average rental yield remains competitive at 4.4% per year.
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BS14 – Whitchurch, Stockwood
BS14 takes the final spot in our top 10, though, like BS4, it also offers a rental yield of 4.4% per year. This area lies a little further south and is a prime location for those looking for an option to escape the hustle and bustle of the city by visiting the surrounding countryside and wonderful Mendip Hills – an Area of Outstanding Natural Beauty.
Even so, BS14 is still well-served by transport links to the city centre and is a popular option for families that wish to live slightly further out of the main urban area.
Thinking about buy-to-let investment properties in Bristol?
As one of the most popular and unique areas to live for families, young professionals and students in the UK, it’s easy to see why Bristol is gaining momentum as a prime location for buy-to-let investors.
If you’re weighing up your options around the Bristol area, feel free to get in touch with our friendly team to discuss your situation and main objectives for your next investment.
NB. The data in this article is an accurate representation of the Bristol property market as of May 2023. We’ll review statistics and update this report next year, in 2024, with fresh data.
