Affordable housing in Preston presents a solid opportunity for investors looking to expand their portfolios with affordable rent properties or discounted property investments. The city has a strong demand for rental homes, with more than 6,700 Preston households deemed to be in need of housing but unable to afford to buy or rent even at the lowest market prices.
Recent developments across the Preston area, particularly in Central Lancashire, are bringing in more new homes. In the past year, 1,060 new homes were built in Preston, equating to 16.05 homes per 1,000 existing homes, surpassing the national benchmark required to alleviate housing shortages.
Many of these schemes offer properties at below open market value, resulting in lower entry costs for investors while still maintaining rental yields in line with market expectations. For investors considering shared ownership properties, these can be a smart way to own part of a property with lower upfront capital, especially with backing from schemes like the Community Gateway Association.
Standard buy-to-let options meanwhile in the city offer strong rental potential. The average rental yield in Preston is currently 4.4%. This is above the UK average of 3.38%. You must have noticed that the PR1 district in the city is performing exceptionally well. That too with average rental yields of 7.1%. Four-bedroom homes, in particular, attract larger households. This increases the rental income stability.
Eligibility criteria for affordable housing schemes are often tied to local connections and housing needs. I recommend investors to remain carefully during assessing the site and purchase process before committing. Visiting ongoing projects reviewing market value trends and ensuring the location aligns with long-term rental demand are prudent steps.
Preston’s affordable housing options provide a great way to enter the rental market. That too at a significant discount. This makes it a promising location for investment.
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Launched in 2024, the Preston 35 Regeneration Plan is a collaborative effort by the Preston Regeneration Board, comprising Preston City Council, Lancashire County Council, the University of Central Lancashire, and the private sector through the Preston Partnership. This ambitious plan aims to deliver 655 new homes, including affordable units, within a 25-hectare urban village regeneration area by 2035. The focus is on revitalising key areas such as the Stoneygate urban village, enhancing city centre residential spaces, and improving business and leisure facilities.
Preston’s local plan aligns with the Central Lancashire Core Strategy, specifically Policy 7, which mandates that market housing schemes contribute to affordable housing. The requirements are set at 30% affordable housing for urban developments, increasing to 35% in rural areas and villages. Exception sites are expected to provide 100% affordable housing. These policies ensure that new developments contribute significantly to meeting the housing needs of the community.
Several new-build developments in Preston offer properties at discounted rates, allowing purchasers to buy homes at 20% or 33% below market value. Eligibility criteria for these schemes typically include income thresholds, local connections, and housing needs assessments. This initiative aims to make homeownership more attainable for individuals who might otherwise be priced out of the market.
Government-backed initiatives, such as Help to Buy Equity Loans, assist purchasers in acquiring new-build homes with reduced deposit requirements and favourable loan terms. These schemes are designed to support first-time purchasers and those looking to move up the property ladder, making homeownership more accessible.
The Lancashire 2050 framework is a collaborative effort by all 15 councils in the region, working to shape long-term plans for housing, infrastructure, and economic growth. The initiative seeks to facilitate strategic partnerships between public and private stakeholders, ensuring that the Preston area attracts national investment for new homes, improved transport links, and sustainable urban expansion. By working collectively, the plan aims to provide more affordable housing while making the city more competitive in the market.
The Preston, South Ribble and Lancashire City Deal is a £434 million initiative designed to transform the local economy over a decade. It is projected to create 20,000 jobs and facilitate the construction of over 17,000 new homes, many of which will fall under affordable housing schemes. The City Deal investment will improve transport links, including key routes around Lightfoot Lane and Tom Benson Way, making newly built properties more accessible and attractive for first time buyers, investors, and renters.
This 15-year strategy is designed to align public and private investments to enhance the city's infrastructure and housing market. With a strong focus on revitalising underused land, the plan will introduce new homes, including affordable housing Preston developments, that will cater to local people with housing needs. The plan incorporates open market value housing and shared ownership properties, ensuring that both investors and renters have access to sustainable property options.
The Lancashire Enterprise Partnership (LEP) is focused on driving economic growth, ensuring businesses in Preston and Lancashire have access to high-quality facilities and skilled workers. This includes initiatives to support developers in creating new build affordable housing options while providing funding for commercial and residential expansions. LEP-backed projects help make affordable rent properties and discounted property investments more viable across the Preston area.
The Preston Local Plan serves as a blueprint for future development, identifying key sites for new build projects while ensuring a balance between urban growth and conservation. The plan supports sustainable construction and affordable housing schemes, outlining clear eligibility criteria for local connection and income thresholds. The approval process ensures that new properties align with the vision set out in the Central Lancashire Core Strategy, which mandates that up to 35% of new housing developments include affordable homes.
Preston City Council has committed to achieving net zero emissions by 2030. This includes facilitating green building practices within new developments, with measures such as energy-efficient housing, improved insulation, and sustainable construction materials. Investors looking to purchase affordable homes with strong long-term value should consider housing options that align with these sustainability targets, as they are expected to become a key factor in future market value growth.
As housing developments increase across Preston, the City Transport Plan aims to enhance connectivity by reducing congestion and improving public transport. This plan will support the demand for affordable rental properties by making key areas more accessible, particularly those near new affordable housing projects. Improving transport infrastructure will allow residents to commute efficiently while increasing the appeal of Preston area housing investments.
The Transforming Cities Fund (TCF) is providing targeted investment to shift away from car-dependent urban planning towards an integrated, sustainable transport system. In Preston, this funding will create pedestrian-friendly public spaces while making new build housing areas more accessible. A focus on reducing pollution and improving walkability will also boost the appeal of housing investments across the city.
Discover your property’s earning potential with our Buy-to-Let Calculator.
Known as the Preston Model, Community Wealth Building (CWB) is a local economic strategy that reinvests resources back into the community. By working with developers, social landlords, and financial institutions, this initiative promotes affordable housing Preston projects while ensuring that property investments benefit the broader local people rather than external commercial entities.
The Preston area has seen significant activity in new housing developments, particularly in locations like Lightfoot Lane and Tom Benson Way. As of January 2025, the average price of a newly built property in the Preston postcode area is £285,000, reflecting a 6% increase over the last twelve months. Many of these properties are part of affordable housing schemes, offering investors potential discounted property options that align with open market value appreciation.
When considering investment options, the choice between flats and houses depends on yield potential and tenant demand. Flats generally present a more affordable housing option, with lower maintenance costs and steady demand from younger renters. Conversely, four-bedroom homes appeal to larger households, potentially generating higher rental yields. Local residents seeking affordable rent options often prefer smaller properties; however, those with a total household income exceeding eligibility for affordable housing schemes might opt for open market purchases instead.
For investors aiming for lower initial investment costs, shared ownership offers a pathway to owning part of a property while renting the remaining portion. Collaborations with organisations like the Community Gateway Association facilitate such investments, allowing gradual ownership increases through "staircasing." Eligibility criteria for these schemes often include a local connection and housing need, making them suitable for investors looking to build a property portfolio.
A substantial portion of affordable homes in Preston falls under social housing managed by housing associations. Approximately 18.6% of all properties in Preston are owned by registered social landlords, the highest percentage in the Lancashire-12 area. Preston City Council collaborates with developers to facilitate the construction of affordable rent properties. These developments are crucial for ensuring long-term affordable housing availability, presenting viable opportunities for investors focusing on affordable rent strategies.
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Investing in affordable housing can be beneficial, offering stable returns due to consistent demand. Additionally, such investments often come with incentives like tax benefits and grants. However, potential investors should conduct thorough research and consider factors like location, demand, and regulatory frameworks.
Yes, Preston presents promising buy-to-let opportunities, especially in areas like Fulwood, Ashton-On-Ribble, Penwortham, Cottam, and Ribbleton. These neighbourhoods attract a mix of families, professionals, and students, ensuring a steady demand for rental properties.
To locate affordable housing in Preston, consider the following steps:
Utilise Property Websites: Platforms like Rightmove and Zoopla list affordable housing options, including shared ownership and discounted market value properties.
Preston’s affordable housing market presents a compelling opportunity for investors looking to enter the property market with lower upfront costs and strong rental yields. With increasing housing needs and rising demand for affordable rent properties, new developments across the Preston area, particularly in Central Lancashire, provide a mix of discounted property options and shared ownership properties that cater to both investors and residents.
Key schemes like the Community Gateway Association and Help to Buy initiatives are making it easier for first-time buyers and investors to step onto the property ladder. Many new homes in areas such as Lightfoot Lane and Tom Benson Way are available at below open market value, providing an affordable entry point while maintaining market value appreciation. Investors looking to purchase affordable homes should carefully assess eligibility criteria, including local connection requirements, to ensure they qualify for specific schemes.
With Preston’s £434 million regeneration plan and ambitious housing initiatives like Preston 35, the city is transforming into a key destination for affordable new build investments. Four-bedroom homes, in particular, are proving to be a lucrative property type, attracting stable long-term tenants. Meanwhile, shared ownership options allow investors to gradually increase their stake in a site without requiring substantial capital.
As land availability and construction costs continue to pose challenges, developers are focusing on maximising affordable housing output while maintaining quality standards. This makes affordable housing in Preston an increasingly competitive and rewarding investment sector.
Whether you’re looking for a discounted property, affordable homes, or high-yield rental units, the Preston area offers significant potential for property investors. Visiting completed sites, reviewing approval processes, and understanding market value trends will help ensure a successful investment. As demand for affordable rent continues to grow, securing the right properties in Preston now could lead to significant long-term gains.
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