As we move through 2026, many landlords are asking the same question: is buy-to-let worth it in a market shaped by higher interest rates, tax changes and shifting tenant demand? The short answer is that buy-to-let can still deliver strong returns, but success increasingly depends on buying in the right location and matching the property type to local demand.
Across the UK, rental demand remains resilient, particularly in cities where population growth, employment opportunities and affordability combine to create attractive conditions for investors. Recent analysis of landlord insurance data from Simply Business highlights clear patterns where activity is growing fastest, offering useful insights into the best property investment areas for the year ahead.
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Why location matters more than ever in 2026
Buying property in the right area has always been important, but in today’s market, it’s crucial. Strong tenant demand helps minimise void periods, while rental growth can offset rising costs. Areas with lower than average property prices can also improve yields, particularly for landlords who are expanding their portfolios.
A fast-growing rental market often leads to higher confidence among landlords and improved long-term prospects. An analysis of more than 100,000 landlord insurance policies revealed several UK cities experienced significant growth in new rentals activity between 2024 and 2025.
Fastest growing buy-to-let areas in the UK
Based on annual growth in new landlord insurance policies, Manchester leads the UK with the highest rental expansion in a 12 month period. New policies in the city increased by 8.6% between 2024 and 2025, reflecting its continued appeal to investors. Liverpool followed closely with growth of 8.3%, while Leicester secured third place with 8%. Leeds and Birmingham completed the top five, both recording annual growth of 7.9%. Although London was sixth in the list, it still had the highest overall number of landlord insurance policies, underlining its scale and long-term importance to the rental market.
Looking at the wider picture, the top ten fastest-growing cities included Nottingham, Edinburgh, Bristol and Glasgow. These figures are compiled from data analysed on 31st December 2025 that measures the percentage increase in new landlord insurance policies year on year.
Manchester, Liverpool and Leicester in focus
Manchester continues to stand out due to strong employment growth, a large student population and ongoing regeneration projects that have supported consistent rental demand. The city’s popularity with young professionals has also driven interest in apartments and shared housing, making it attractive for both single let and HMO landlords.
Liverpool has followed a similar trajectory. Affordable property prices, combined with significant regeneration around the city centre and waterfront, have drawn investors looking for higher yields. Tenant demand remains strong, particularly among renters aged 25 to 40.
Leicester’s central location, two major universities and relatively low entry prices have made it increasingly appealing. Rental growth has been steady and the city performs well for both family housing and shared accommodation.
Where are the best buy-to-let areas for portfolio landlords?
For landlords looking to grow beyond a single property, scale and consistency matter. Portfolio landlords often focus on cities with large rental markets, diverse property stock and strong long-term demand.
The areas with the highest concentration of multi-property landlords are London, Manchester, Birmingham, Nottingham, Glasgow, Liverpool, Edinburgh, Bristol, Leeds and Leicester. London remains the fastest-growing area for portfolio landlords, with a 12% increase in multi-property landlords between 2024 and 2025. Edinburgh and Leicester both followed closely with growth of 11%, while Birmingham recorded 10% growth.
These locations suggest experienced investors continue to favour major cities where risks can be spread across multiple properties and tenant types.
Where are the best investment properties for HMO landlords?
Houses in multiple occupation continue to appeal to landlords seeking higher rental income, particularly in cities with large student or young professional populations. To succeed with an HMO, location is key, as demand needs to be consistent throughout the year.
The best performing cities for HMO landlords during 2025 included London, Birmingham, Bristol, Manchester, Leeds, Nottingham, Edinburgh, Cardiff, Liverpool and Coventry. All of these cities benefit from universities, strong employment markets, or both.
Edinburgh stands out as the fastest-growing HMO location, with the number of HMO insurance policies increasing by 14% between 2024 and 2025. Manchester followed in this sector with 13% growth, while London recorded 11%. Nottingham also performed strongly with 8% growth.
Popular buy-to-let investment areas by property type
Different property types attract different tenants, and regional trends reflect this. Detached houses were most popular with landlords in Nottingham, suggesting strong demand from families. London dominated the market for terraced and semi-detached houses, driven by space constraints and high tenant demand.
For maisonettes and bungalows, London again led the way, particularly in areas such as Harrow and Wembley, followed by Birmingham and Southampton. Nottingham, Leicester and Norwich emerged as top locations for bungalows, reflecting ageing populations and demand from older renters.
Flats remained heavily concentrated in major cities. London ranked first, followed by Edinburgh, Glasgow and Aberdeen, with Manchester completing the top five.
Making properties tenant-ready in high-demand areas
In competitive rental markets, speed matters. Landlords investing in fast-growing areas often look for ways to reduce void periods and attract tenants quickly. Services such as buy-to-let furniture packages and HMO furniture packs offer ready-made solutions that align with tenant expectations.
Well-designed furniture packages can make properties feel modern and functional from day one, particularly in cities popular with young professionals and students. For HMOs, consistent furnishing across bedrooms and communal areas can also simplify management and improve tenant satisfaction.
Final thoughts
For landlords who choose locations carefully, understand local demand and prepare properties efficiently, the market can remain profitable. By focusing on the best property investment areas, matching property types to tenant demand and using tools that streamline setup and management, landlords can position themselves for the year ahead.