Pockets of Bath Perfect for Profitable Rentals

Nestled in the rolling hills of Somerset, Bath is not just a city steeped in history and culture; it’s also a hotspot for property investors looking for a blend of charm and solid returns. With its UNESCO World Heritage status, stunning Georgian architecture, and thriving local economy, Bath offers a unique proposition for property investment. Here, we embark on a journey through Bath to uncover the best places to invest in property for profitable rentals, and where historical allure meets modern living.

Why invest in Bath?

Bath, a city with deep Roman roots dating back to 60 AD, sprang to life around its naturally occurring geothermal springs. Originally known as Aquae Sulis by the Romans, who were drawn to the area for its therapeutic baths, the city has evolved into a UNESCO World Heritage site, celebrated not only for its historic origins but also for its exquisite Georgian and Regency architecture.

As the largest city in Somerset, Bath boasts a population of around 90,000 and sits elegantly on the River Avon, within the governance of the Bath and North East Somerset council. Its charm and beauty make it a magnet for tourists, with about 6.25 million visitors exploring the city annually, making it one of the UK’s top tourist destinations for international visitors.

Regeneration projects

Many regeneration projects are currently taking place in Bath, which adds to the splendour of investing in this city. 

• Bath City Centre Regeneration Programme: New life is being breathed into the heart of Bath, making sure it stays a favourite spot for everyone.
• Milsom Quarter Masterplan: Milsom Quarter is being transformed, moving beyond its retail legacy to include housing, a revamped fashion museum, creative spaces, and more, making it a go-to destination for fashion and culture lovers.
• Bath Central Riverside: This exciting new project is set to rejuvenate the stretch from Pulteney Bridge to Bath Spa Train Station, enhancing the area’s charm while addressing climate change and preserving the World Heritage status.

• Broad Street Place: The potential of the community garden in the heart of Bath is being unlocked with a design that’s as playful as it is user-friendly. Expect an enhanced public space that draws more visitors, strengthens community ties, and boosts local interaction – all while making it safer and more biodiverse.

Things to do in Bath

The allure of Bath is undeniable, with landmarks like the ancient Roman Baths and Pump Room, the modern Thermae Bath Spa, the majestic Bath Abbey, and architectural marvels such as the Royal Crescent and The Circus drawing crowds. 

Visitors also enjoy the Assembly Rooms, the picturesque Pulteney Bridge, and a variety of museums including the Victoria Art Gallery and Herschel Museum of Astronomy, all contributing to Bath’s reputation as a city rich in culture and history.

Property market overview

Bath is a truly sought-after spot for property seekers, thanks to its irresistible charm and the classic case of high demand meeting limited supply. If you’re eyeing the Bath and North East Somerset area for your next move or investment, you’ll be interested to know that the average property price here is £586,859 according to Rightmove. 

Sold prices over the last year were down 2% on 2023, and 7% up on the 2021 peak of £547,829. It’s clear that Bath’s property market is buzzing, making it an exciting time for both buyers and sellers in this beautiful region. 

Rental demand

Generally speaking, there is a high demand for property in Bath due to housing shortages, and as such, tenants will be paying higher rent compared to other areas in England. The average rent sits at £2,053 pcm, which is great for landlords and property investors. 

The average amount of rent that you can expect as a landlord for a one-bedroom property is £975, £1,525 for a two-bedroom, and £1,900 for a three-bedroom. There’s been a notable 7.5% increase in rent over the past year, largely due to a significant shortage of available rental properties in the area – a trend that’s not just local but seen across the country. 

This scarcity means that rents have been nudging upwards, and it seems like this pattern might stick around for a bit, potentially pushing rents even higher in the future. It’s an important time to keep a close eye on the market, whether you’re looking to rent or let, as these dynamics continue to shape the landscape.

The best areas to invest in property in Bath

So, as you can see, buying property in Bath can be a lucrative investment. Now, let’s take a look at the best places to invest in property to expand your property portfolio. 

City centre

With a cosy population of 9,000 and average house prices ranging between £550,000 and £650,000, Bath’s city centre is a treasure trove of history and elegance. Here, the living spaces are a mix of stunning period properties and some modern developments like Bath Riverside. The area is famed for its Georgian and Regency terraces, offering mostly apartments and townhouses. 

While it ranks among the pricier locales in southwest England, the strong demand for rentals and potential for price appreciation makes it a wise choice for investors, boasting average yields of around 4.3%.

North west suburbs

Home to 12,200 residents, the north-western suburbs like Weston (split into Upper and Lower) fit into the city’s surrounding hills, offering picturesque living with average house prices from £340,000 to £450,000. 

The area’s charm, combined with its access to Royal Victoria Park and proximity to The Royal United Hospital, makes it a sought-after yet more affordable residential choice compared to the city centre. Lansdown adds a touch of exclusivity to this suburban mix. Investment yields here also hover around 4.3%.

North east suburbs

With a larger population of 30,500, the northeastern suburbs stretch along London Road and include Camden, Larkhall, and Batheaston, among others. These areas are known for their period properties and accessibility to both Bath and nearby towns. With average house prices between £390,000 and £490,000, these neighbourhoods offer a perfect blend of city access and scenic living, with investment yields around 4.3%.

South suburbs

The south suburbs, home to 32,300 people, present a variety of living options with prices ranging from £270,000 to £480,000. Areas like Twerton and Bear Flat are notable for their proximity to the city and transport links, with Bear Flat being particularly desirable for its walkability and the beautiful Alexandra Park. This region, known for its more contemporary housing, offers a slightly higher yield of 4.4% due to its affordability and diverse property options.

Surrounding villages

For those craving a rural backdrop, the villages surrounding Bath house approximately 8,200 residents, with property prices spanning £300,000 to £650,000. These idyllic settings offer more return on investment, albeit with a trade-off in terms of direct access to Bath. 

These areas continue to remain popular for both Bath and Bristol commuters, especially with areas like Bradford on Avon providing quick train links. Investment yields in these villages range from 4.3% to 4.5%, offering a peaceful alternative to city life.

Whether you’re drawn to the historic allure of the city centre, the scenic views of the suburbs, or the tranquil charm of surrounding villages, Bath’s property market offers a spectrum of opportunities for homebuyers and investors alike. With a variety of lifestyles and investment potentials, Bath continues to be a vibrant and desirable place to call home.

For more information on buy-to-let insurance, contact us at CIA Landlords on 01788 818 670.