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Overview of Preston’s Property Market
If you’ve been keeping an eye on property investment opportunities, Preston should definitely be on your radar. The city is steadily carving out a name for itself as an affordable yet growth-oriented market.
What makes it special? It’s got a bit of everything: a vibrant urban core, quiet suburban areas, and a growing reputation as a commuter-friendly location thanks to excellent transport links to Manchester and Liverpool.
Preston is also undergoing some serious upgrades. The £434 million Preston City Deal is bringing in new infrastructure, housing, and commercial spaces, making the city even more attractive.
And it’s still affordable compared to other cities in the North West. Whether you’re looking to build a portfolio, generate passive income, or plan for retirement, Preston offers plenty of options to consider.
Current Market Snapshot (2023-2024)
In Preston, the average property price continues to offer excellent value compared to nearby cities, with average house prices reflecting steady growth year on year. The average price paid for a property in Preston is significantly below the national average, making it a hot spot for investors and buyers.
Recent House Price Trends in Preston
Preston’s house prices are on the rise, but they’re still incredibly reasonable. According to the Office for National Statistics (ONS), the average house price in Preston is £169,000 as of August 2024.
Source: ONS
That’s an annual growth of 4.7%, showing steady and sustainable progress. Compared to Manchester (£250,000) or Liverpool (£200,000), Preston offers a much lower entry point for investors while still delivering strong growth potential.
On the rental side, it’s all about returns. Flats in the city centre rent for £550–£600 per month, while larger semi-detached homes in suburbs like Fulwood or Penwortham can fetch up to £1,200.
Rental yields average between 5% and 6%, and in high-demand areas, they can go even higher. It’s a market where your investment works for you in both capital appreciation and rental income. While some might worry about the dip in property prices, it’s important to note that such fluctuations are natural in any healthy property market.
Data from the land registry highlights strong activity, with numerous property transactions and sales volumes for existing properties sold, reflecting robust demand in Preston’s real estate market.
The graph illustrates how Preston consistently aligns with broader trends seen across the North West, England, and Great Britain, maintaining a resilient position even during periods of economic uncertainty.
The graph below shows house prices, inflation rates, and borrowing rates have changed in the last few years in the UK. House prices have changed a lot because of inflation and changes in mortgage rates. The graph shows that prices go down during times of high inflation and interest rates, but then they go back up and grow again.
One key takeaway is the resilience of property prices. Even though there are changes, the general trend is still going up. For example, after the financial crisis of 2008, home prices fell, but they slowly rose again and finally topped their previous highs.
In the same way, when inflation and mortgage rates went up recently in 2022, home prices slowed down. However, they have now started to stabilise, creating another buying zone, as shown in the graph.
This means, now is a great time for investors to invest in the property. Right now, when prices are stable, inflation is low, and there are opportunities in key buying areas, it’s a great time to buy homes at low prices.
In the past, buyers who acted quickly when the market changed often made a lot of money when the market recovered and prices started to rise again. Investing in places like Preston that are likely to grow quickly, means you can get both rental income and long-term capital gains.
Comparison with Regional and National Trends
When you compare Preston to other cities in the North West and across the UK, it really stands out. Preston’s £169,000 property price seems like a steal when compared to the national average of £293,000.
Preston has a competitive edge for investors seeking more inexpensive options without losing growth potential because prices are far higher in places like Chester and Manchester, even in the North West.
With an annual increase in home prices of about 4.3%, the North West as a whole has been doing well. However, Preston surpasses even that, proving its capacity to draw in both tenants and investors. This indicates to investors that they are joining a market that has shown itself resilient and has the potential for future expansion.
Key Factors Driving the Current Market
Is Preston really doing so well? Employment plays a big role. Employment has grown in the city in fields like education, healthcare, and shopping, which is bringing more people to the area.
Add to that the demand from the University of Central Lancashire (UCLan) of more than 35,000 students and young professionals who are choosing Preston over more expensive neighbouring cities, and you’ve got a thriving rental market.
Regeneration projects like the Preston City Deal are also playing a huge role. Better amenities, new housing projects, and improved transportation make the city more livable, which increases demand. Not to mention affordability—at a time when people are trying to save money, Preston provides an opportunity to buy or rent high-quality real estate without having to pay the exorbitant prices found in Manchester or London.
Preston’s market offers a variety of property types, including detached properties, which are particularly appealing to families and investors. The city’s diversity in housing stock ensures options for a wide range of investors.
Preston is one of the most promising real estate areas in the North West because of its affordability, improved infrastructure, and rising demand. This city provides stability as well as a wealth of growth prospects for investors.
Angel Gardens is located in an up-and-coming district of Liverpool. It is in close proximity to two major regeneration projects: the £150 million Project Jennifer and the £5.1 billion Liverpool Waters scheme.
Cash Needed
Rent per month
Limited Units
£185k
How the Bank of England Influences the Lancashire Property Market
As a property advisor, I often remind investors that the Bank of England plays a huge role in shaping the property market. Actions taken by the government on inflation control and interest rates affect mortgage rates, house prices, and investor confidence. Knowing how these policies influence the market will help one invest in Preston or anywhere in Lancashire.
Interest Rate Decisions
Those who buy and sell houses have been particularly vocal about interest rates this year. Since September 2024, when the Bank of England’s base rate shot to 5.25%, mortgages have been more expensive.
Some people are therefore less prone to buy. Typically costing £191,000, semi-detached houses in Preston are showing more financial restraint.
That said, opportunities still exist in this kind of market, particularly for investors with cash or substantial deposits. Flats and apartments, with an average price of just £93,000, present excellent value for money.
These lower entry costs make them a prime choice for investors looking to capitalise on rental demand or those aiming to secure long-term growth. Moments of hesitation in the market often create windows for strategic investors to negotiate better deals, and apartments are a standout option in this environment.
Inflation Control and Monetary Policy
Inflation is now at 6.7%, down from its peak of 9% in 2022. This drop has influenced the Bank of England to raise interest rates, which has slowed the growth of house prices.
In Preston, house prices have grown more slowly, with a yearly change now at 4.7%, compared to the faster rises in recent years.
This slowing market creates opportunities for investors. The “buying zones” as we discussed above, are where price growth stabilises, making it a good time for strategic investors to take advantage of competitive prices.
We have witnessed this effect in buildings ranging in price points. Demand for more reasonably priced options like flats and apartments remains robust even if more valuable homes like detached villas have stalled.
This climate emphasises for investors the need to concentrate on properties resistant to changes in the market.
Investor Confidence and Sentiment
When borrowing becomes more expensive, it’s common to see some hesitation from investors. But here in Preston, the market still holds a lot of appeal. We’ve noticed a consistent demand for rental properties, especially flats in the city centre, which rent for £550–£600 per month, and family homes in suburbs like Fulwood.
While some investors wait for interest rates to stabilise, others are taking advantage of off-plan properties in high-demand areas. These opportunities allow buyers to secure properties now and start paying their mortgage only after two years, once the property is built and rented out—offering a smart way to navigate the current market conditions.
In Preston, rental yields remain strong at 5–6%, making it a reliable option even in uncertain times. From what we’ve seen, investors who act strategically during periods like this often reap the rewards when confidence returns to the market. These are the moments where well-planned decisions can lead to significant gains.
Factors Likely to Influence House Prices in Preston in 2025
There are a few things we think will affect the real estate market in Preston in 2025. Factors like economic growth, university development, improvement in infrastructure and the way supply and demand work, all affect the house prices.
Economic and Employment Growth
Preston’s housing market is largely driven by its growing economy. Big jobs have been created in fields like education, healthcare, and shopping, which is bringing more people to the area. Eventually, house prices will go up because more people want to live in homes.
Source: ONS
Property types like semi-detached houses, which cost an average of £191,000, are perfect for families moving to the area.
At the same time, flats and apartments present a unique opportunity for investors. With an average price of just £93,000, they come with a lower ticket size and often provide better rental yields, typically around 6–7%. These properties are highly sought after by young professionals and students, ensuring a steady stream of tenants.
Focusing on places close to new job centres or big employers can give investors great long-term returns as demand keeps going up.
University Expansion and Student Demand
The University of Central Lancashire (UCLan) keeps growing, which means that people are always looking for places to rent. There are a lot of investors who focus on this market, and they can make a lot of money.
People in their 20s and 30s are always looking for flats in Preston that cost around £93,000 and terraced houses that cost around £135,000. This area has high usage rates and steady rental income, making it a great choice for investors who want to keep their money coming in.
Infrastructure and Development Projects
Thanks to major infrastructure projects like Western Distributor Road and funding from the £434 million Preston City Deal, Preston is changing. These projects are making the city a better place to live and travel, which is attracting both renters and investors.
Places like Fulwood and Penwortham, where home prices are usually between £170,000 and £250,000, are already seeing the benefits. Investors should focus on areas where new projects are planned or are already happening. This is because home prices tend to rise the fastest in these areas.
Supply and Demand Dynamics
I always say that understanding supply and demand is crucial to successful property investment. In Preston, demand continues to outstrip supply, especially in high-demand areas close to schools, transport links, and major employers.
This imbalance has also driven rents up by around 6% over the past year. For investors, this creates a market where properties—whether flats, terraced houses, or family homes—offer strong potential for rental income and long-term growth.
From our experience, Preston’s property market is full of opportunities, whether you’re a first-time investor or looking to expand your portfolio. Its mix of affordability, growth potential, and steady demand makes it one of the North West’s most promising locations.
With the right strategy and a focus on high-demand areas, there’s every reason to believe that 2025 will be another strong year for property investment in Preston. We’re always here to help guide you through the process, so you can make informed decisions and maximise your returns.
Predicted Preston House Price Trends in 2025
Looking ahead to 2025, Preston’s housing market is certain to keep on its consistent upward trajectory. Current statistics and market dynamics indicate great possibility for property price increases, especially in places experiencing redevelopment or gain from infrastructural upgrades.
Comparing trends to the previous year, properties in Preston show resilience and consistent growth, catering to diverse buyers seeking various types of property. Preston’s housing market will probably present plenty of opportunities for investors seeking long-term growth and consistent rental income.
Expert Forecasts and Market Analysis
Given the average annual growth rates of the city, industry analysts project that property prices in Preston will rise by about 4–5%. Preston’s relative cost to other UK cities helps it to be well-positioned for continuous demand, even if rising interest rates and inflation’s would restrict more rapid growth.
We have personally experienced how elements like employment growth, university development, and project completion like Western Distributor Road help to create a strong housing market.
The secret for investors will be concentrating on homes in places like the city centre or suburbs like Fulwood where there is great rental demand. When it comes to rental yields and capital appreciation, flats and apartments (£93,000 on average) are likely to excel.
Expected Growth Rates Compared to Other North West Cities
Preston still stands out among other North West communities for its mix of cost and development possibilities. Although cities like Manchester and Liverpool are forecasted to have growth rates of around 3-4%, Preston is likely to nudge somewhat higher, with projections in the region of 4-5%.
Its somewhat low average property price of £169,000, which is significantly below the UK national average of £293,000, is mostly responsible for this. Investors are drawn to this affordability nonetheless.
Because Preston is both in high demand locally and not as competitive as bigger towns, it is a unique place to invest in the North West. We believe this will continue to attract investors looking for a market with room to grow.
Conclusion
Preston’s property market is a top choice for property investors in 2025 since it still presents a convincing mix of affordability, consistent development, and great demand for rentals.
Driven by economic development, university expansion, and significant infrastructure projects, house prices are expected to climb by 4-5%, positioning the city in both short-term gain and long-term appreciation.
Preston offers chances few other North West locations can equal whether your focus is on creating a varied portfolio, acquiring a presence in an expanding sector, or targeting high-yield rental properties. Focussing on high-demand regions and matching your plan with the changing dynamics of the city will help you to maximise its possibilities and profits.
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