Data from Paragon’s own lending activity revealed a strong increase in completions in city and town centre postcodes during 2021, up 100% on 2020.
The strongest increases were seen in locations outside of the UK’s major city centres. Aside from London and Manchester, the top 10 highest growth locations in urban completions were in secondary towns and cities.
The highest percentage increase was recorded in Milton Keynes, which experienced a 667% increase in completions in 2021 compared to the previous year. This was followed by Bristol with a 300% increase, Manchester (300%) and Luton (258%).
Other urban locations in the top 10 included Plymouth (183%), Stoke (157%), Northampton (133%), Cardiff (70%) and Nottingham (64%).
In London, Paragon’s figures show a 95% increase in buy-to-let completions in the capital during 2021, with landlords concentrating acquisitions in Zones 2 and 3 as they balanced the requirement for yield, availability of property and tenant demand.
Richard Rowntree, Paragon Bank director of mortgages, said: “Landlord demand for city and town centre property was strong in 2021, with Paragon’s analysis showing completions for house purchase increasing by 100% compared to the previous year.
“The strongest growth was not necessarily in the UK’s major cities. Aside from London and Manchester, the top 10 growth locations were in secondary cities or large towns. The likes of Milton Keynes, Luton, Bristol, Northampton and Nottingham experienced strong double or triple-digit growth in completions during the year.”
He concludes: “There appears to be one of, or a combination of, three factors that each of these locations share. They are in commutable distance to a major city, they mostly have vibrant universities and they have healthy local economies. Landlords have been reacting to changing tenant demand and there is clearly demand for tenants to retain urban living, but perhaps targeting smaller towns and cities.”
