"Coastal properties may be attractive for rental yields and lifestyle appeal, but with extreme weather events expected to intensify, long-term sustainability must be a key consideration"
- Cliff Ward - Pikl
Demand for UK coastal properties continues to grow. As such, investors are weighing not only potential returns but also the rising risks posed by climate change. And as property prices remain high and affordability is squeezed, understanding the balance between investment viability and long-term resilience is more crucial than ever.
To help, Insurance experts at Pikl have analysed publicly available property market data to identify the UK’s top 10 coastal investment hotspots. Their assessment considers key factors such as Price-to-Income (PTI) ratios and flood risk levels, offering a comprehensive view of where investors can find the best opportunities while mitigating potential climate-related challenges. The findings also highlight how PTI ratios have evolved in recent years, reflecting broader trends in the property market.
Top 10 Coastal Investment Locations in the UK (ordered by price to income ratio) 1-3
1. South Shields, Tyne and Wear
- Average House Price: £213,713
- Projected Gross Annual Revenue as a Private Rental: £12,792
- Private PTI Ratio: 16.7
- Projected Gross Annual Revenue as a Holiday-Let: £16,630
- Holiday-Let PTI Ratio: 12.8
- Flood Risk: Low
South Shields offers the fastest return on investment amongst the UK’s coastal locations, with a strong rental market and low flood risk, making it a top choice for investors looking for long-term gains in either private rental or holiday-let industries.
2. Falmouth, Cornwall
- Average House Price: £573,130
- Projected Gross Annual Revenue as a Private Rental: £30,540
- Private PTI Ratio: 18.8
- Projected Gross Annual Revenue as a Holiday-Let: £39,702
- Holiday-Let PTI Ratio: 14.4
- Flood Risk: Moderate
Despite a higher property price, Falmouth’s significant rental revenue helps investors achieve a return faster than many other coastal locations across the UK, although the moderate flood risk should be considered when looking at properties.
3. Morecambe, Lancashire
- Average House Price: £222,454
- Projected Gross Annual Revenue as a Private Rental: £11,532
- Private PTI Ratio: 19.3
- Projected Gross Annual Revenue as a Holiday-Let: £14,991
- Holiday-Let PTI Ratio: 14.8
- Flood Risk: High
Morecambe remains a strong investment due to affordable property prices and a steady rental income, though high flood risk may impact long-term sustainability and is worth considering when it comes to exact location and insurance premiums.
