Manchester’s M14 postcode was the most popular location for buy-to-let (BTL) landlords to invest in during 2023, according to Paragon Bank.

Paragon analysed lending data to reveal the top 10 locations for investment.

The M14 postcode, covering Manchester’s Fallowfield, Rusholme, Old Moat, and Ladybarn districts, and located between the University of Manchester and Manchester Metropolitan University, was attractive due to its high student population.

The research found that those investing in the area achieved rental yields of up to 7.5%.

This was followed by the B29 postcode, covering the Selly Oak, Bournville, Edgbaston, Kings Heath, Northfield and Stirchley districts of Birmingham.

Again, this area was home to a sizeable student population, especially in Selly Oak, the location of Birmingham University.

Although properties in this postcode were the most expensive on the list, the average purchase price of £573,116 was skewed by the presence of large, period properties in Bourneville, the model village founded by the Quaker Cadbury family.

The third most popular BTL hotspot was DH1 in Durham where properties delivered yields of up to 7.3%.

Continuing the theme of thriving student markets, the University of Durham’s Palatine Centre is located in Framwellgate Moor, contributing to the postcode’s popularity amongst students.

Richard Rowntree, managing director at Paragon Bank, said: “Our data shows that portfolio landlords have a strategy of targeting major towns and cities across England and Wales, from Brighton and Hove on the south coast, up through the midlands and Wales and onto Newcastle.

“Something that links many of these diverse areas is their proximity to universities or large employers, such as the NHS or manufacturing and distribution hubs.

“This helps to illustrate the crucial role that the PRS plays in supporting further education provision and the workforce, both vital facets of the UK economy.”