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Why South Wales is a Hotspot for Property Investments.

Updated: Nov 11, 2022

South Wales is a 'loosely defined region of Wales bordered by England to the east and mid Wales to the north.' As well as benefiting from beautiful mountainous and coastal views it's also home to the capital city of Wales where some of the UK's biggest national events take place.

Home of the red dragon, South Wales is also becoming a UK hotspot for property investments. So what is it about this fairy tale landscape where people are outnumbered 1:3 by sheep that makes property investors tick?

Firstly, the average cost of living in Wales is considerably lower than the UK average. The average cost of a property in Wales is £144k compared with the average UK of £216k. But it's not just the price which makes South Wales such a fantastic place for property investment at the moment. Large regeneration schemes have been put in place to grow the Welsh economy which makes now a great time to be buying up investment property! So where exactly are the goldmine areas in South Wales?


Suitable strategies: Professional HMOs, Student HMOs, Single Lets, Flips, SA

Swansea is a coastal city and county. Home to one of the UK's fastest-developing Universities, Swansea has a population of 241,300 and a student population of 24,000. This makes it a great place for Student HMOs as they generate high cash-flow but the buying in price is a little less expensive than your average city HMO which means you can buy more and leverage your portfolio.

But Swansea isn't just home to students. Benefiting from beautiful coastlines and stunning views, many pensioners choose to come to Swansea to retire. This makes it a good area for flips- especially bungalows for elderly people who don't want to live in a property with a staircase. When choosing an area for investment property it is also important to consider your market demographic- so who you're going to sell/rent it to.

Swansea is currently undergoing a new regeneration project called regeneration Swansea. Regeneration Swansea is a partnership working to maximize economic benefits from regeneration projects in order to improve the prosperity of the local area and its people. This is a fantastic scheme that will ultimately push more business into the city meaning Swansea is set to grow economically. This makes it a great place to invest as it will benefit massively from capital appreciation as a result of it's expansion.

A few miles up the coastline of Swansea is the Gower. In 1956, Gower became the first area in the United Kingdom to be designated an Area of Outstanding Natural Beauty. It is an extremely popular holiday destination for UK holiday goers and makes a great destination for holiday lets.

Port Talbot.

Suitable strategies: Single Let's.

Port Talbot is a town and community in the county borough of Neath Port Talbot, South Wales. It is 7 miles to the east of Swansea across the Swansea Bay, with a population of 37,276. Port Talbot is home to one of the largest Steelworks in the country providing 4,000 jobs. This makes Port Talbot a great area for rental property as many workers look for nearby accommodation to rent. Port Talbot also has great transport links to Cardiff and Swansea, two large cities which also provide many jobs for workers.

Bridgend Valleys and the Rhondda Valleys.

Strategies: Single Let's, Flips.

The Bridgend Valleys and the Rhondda Valleys have proven to be a great area for property investment in South Wales, especially single lets. With a good long term tenant, you can't go wrong with a trusty single let purchased at a low price to diversify your portfolio. Furthermore, the Bridgend and Rhondda valleys are home to absolutely stunning country views and there are plenty of cycle trails and parks making them great areas for families. Additionally, they also have great transport links to Swansea and Cardiff.

The Rhondda Valley and the Bridgend Valley's house prices typically range from 40-120k depending on the amount of refurbishment needed on the property. Many of the properties around these areas are miners cottages and were well built.

The lower price makes them ideal for investment properties. They can achieve extremely high yields and make excellent long term investments. Much of the demographic of tenants around these areas are more long term as people typically tend to stay longer in these areas. This is why they make such stable investments in comparison to HMO tenants in the city, which will be turning over tenants often annually.

Rhondda's Treorchy high street, located in the Rhondda Valley was even crowned Britain's 'best', in the Great British high street awards and was awarded £15,000.

Property investment south wales

Treorchy High Street was awarded first place in The Great British High Street awards.

Developments in the Bridgend Valleys

Bordering Bridgend in the Afan country forest park, planning permission has been granted for none other than Bear Gryls to develop a 200m adventure park. The major tourism development is planned for a 325-acre former forestry plantation at Pen-y-Bryn by Croeserw and Cymmer, lying alongside the border of Bridgend county. It is estimated that 535 full-time jobs will be created throughout the two-year build-period and once operational in 2021, the resort will directly employ 970 full and part-time staff.

Gryls says “It will be something wonderful for South Wales, the economic, social and awareness benefits are great – that something like this is set in the Afan Valley will spread throughout the whole of the UK.”

'The resort will be the UK’s first adventure holiday resort of its kind, catering for stays between three and seven days, and offering a range of on-site adrenaline-fuelled activities.

It is forecast that there will be around 5,000 visitors per week – 260,000 per year.'

You can read more about the Adventure Park on Wales Online but this particular development will bring a lot more capital meaning economic growth and capital appreciation for the area .Further more, additional job roles in the resort will also mean a higher demand for property.


Strategies: Single Let's, Professional HMO's, Student HMO's, SAs,

Cardiff is the world's closest capital city to London, and an excellent investment area. It is one of the fastest growing cities in the UK, it's infrastructure benefiting heavily from regeneration.

Cardiff has a population 474,000 people and a student population of a whopping 44,000! There are three Universities within the city making it a fantastic place for student and professional HMOs as many students choose to stay in the city after graduating because of job opportunities.

Cardiff also has good transport links with it only taking 1hr 45m on the train to London. However, house prices are much lower in Cardiff in comparison to London which is why many people find it preferable as it still has that city feel to it. With Cardiff’s GVA growing faster than any other core UK city at 5.7%, it is estimated to be the fastest-growing core city for the next 20 years, making it firmly one of the top UK cities to watch in 2020 and a hotspot for property investments.

Another strategy which works well in the city is Serviced Apartments. Cardiff hosts some of the biggest UK events including The Six Nations in Principality Stadium. SAs in Cardiff generate an extremely high yield as many people from all over the world come to visit the city.


Strategies: HMO, Single Let's, SA, Professional HMO

A little further down the M4 from Cardiff, Newport is another property investment hotspot that you should look out for.

Only 38 minutes from English city Bristol, Newport has seen a rise in house prices of 4.48% (a value change of £8,282) since the government decided to scrap the £6 fee you had to pay every time you crossed the Severn Bridge into Wales.

Because house prices in Newport are considerably lower than in Bristol, many people who work in Bristol have chosen to migrate across the bridge to live in Newport, where the prices are lower. This makes it a current investment hotspot as house prices are on the rise.

So there we have it, our top property investment areas in South Wales. We hope we gave you a little taster of just some of the fantastic investment opportunities that South Wales have to offer. However, if you're still unsure about investment areas using a trusted local property sourcing agent can be extremely helpful in finding a property in the right location.

Thanks for reading.

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