Property investors often face a choice between two strategies. Do you buy a property that needs refurbishment with the aim of adding value, or do you choose a ready-to-rent buy-to-let that starts generating income from day one? Both options have their appeal, but the current UK market makes one path stand out.

The Case for Refurbishment

Refurbs have always attracted investors who like the idea of creating value through renovation. Buying at a lower price, carrying out improvements, and then either refinancing or letting the property can in some cases lead to strong gains. Tenants increasingly expect modern layouts, good insulation, and energy efficiency, so an upgraded home can certainly justify a higher rent.

However, refurbishment is never without risk. Rising material and labour costs mean projects often run over budget. The Building Cost Information Service has reported a steady rise in construction costs over the past three years, with a further increase expected in 2025. Delays are also common, leaving properties empty for months at a time. For investors relying on rental income, these void periods can reduce overall returns.

The Case for Buy to Let

Ready-to-rent buy-to-let properties remove much of this uncertainty. Investors begin receiving income almost immediately, which is particularly valuable given current rental trends. According to Zoopla, average UK rents rose by 7.5 percent in 2024. In the North West, growth was just under 6 percent, and rental yields in cities like Liverpool, Salford and Manchester consistently sit between 7 and 9 percent.

Confidence in buy to let has also returned. By the end of 2024, lending volumes in the sector had grown nearly 40 percent compared with the year before. Investors are clearly prioritising stable, income-producing assets over riskier projects. With forecasts suggesting UK house prices could rise by around 20 percent in the next five years, and rents by another 17 percent, buy to let continues to look like a secure long-term strategy.

What Investors Are Choosing

In regeneration zones such as Liverpool Waters and MediaCity, new build buy-to-let schemes are proving especially popular. Investors who once focused on heavy refurbs are increasingly drawn to properties that align with strong rental demand from students, professionals and families. Immediate cash flow, combined with the potential for future capital growth, makes these investments attractive without the stress of managing a complex refurbishment.

Refurbishment can still work for investors with the right skills, contacts and appetite for risk. For most, however, the strength of the rental market means buy to let is the smarter and more reliable option. With demand high across the North West and other key UK cities, investors are finding that a well-placed buy to let can outperform a refurbishment both in the short term and over the long haul.

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