Derby Property Market Outlook for 2026
While the national market has navigated recent economic challenges, core regional cities across the Midlands have shown exceptional resilience and growth. In the search for better value, connectivity, and quality of life, tenants and homebuyers have consistently gravitated towards major centres in the East Midlands, with property in Derby being a prime beneficiary.
This sustained inward migration, including a significant percentage of buyers and renters relocating from the South, solidifies Derby’s potential.
This strong outlook is driven by fundamental economic factors. With 64% of Derby workers living in the city and 21.2% of the local population aged between 19 and 35 – both major demographics within the rental market – our Derby property price forecast remains positive.
As the Derby Masterplan continues its development and the city’s exceptional transport connectivity improves, the potential for Derby property investment in 2026 is stronger than ever.
Derby Property Prices: A Five-Year Outlook to 2030
Derby’s robust market performance has seen property values climb significantly over the last decade, bolstered by billions in inward investment and a diverse, resilient local economy.
Average Property Value (2025): £210,531
10-Year Growth: Property values have risen by a notable 40% over the past decade.
Annual Growth (2024–2025): The average property value saw a strong 6.7% increase in the past year alone.
The market has consistently demonstrated its strength. Even against a backdrop of complex economic pressures, Derby has been a standout performer, often seeing house price growth that outpaces the rate of inflation. This exceptional resilience is why Derby is consistently hailed as a top UK property hotspot for investment.
Our long-term forecast remains highly optimistic:
| Period | Projected Price Growth (Range) |
| May 2025 – May 2026 | 5.5% – 7% |
| May 2026 – May 2027 | 4.5% – 6% |
| May 2027 – May 2028 | 4% – 5.5% |
| May 2028 – May 2029 | 3.5% – 5% |
| May 2029 – May 2030 | 3% – 4.5% |
Capital Growth Potential: At the current average price, a property in Derby is forecasted to be worth around £269,200 by 2030, generating a potential capital gain of nearly £59,000. Now is a crucial time to secure assets at current pricing, positioning investors to benefit from this significant, sustained appreciation.
Derby Rental Prices in 2026
The positive property price forecast naturally correlates with an anticipated rise in rental values throughout 2026 and beyond, driving attractive yields for investors.
Derby’s rental market is currently experiencing high demand and low supply, leading to sharp increases in rental values. This trend is unlikely to abate given the city’s demographics and ongoing population growth.
Average Monthly Rent (2025): £840
Average Rental Yield: 4.11%
The considerable demand for rental units—fuelled by ‘Generation Rent’ and a large, economically active young population—underscores the profitability of Buy-to-Let investment in the city. With thousands of residents awaiting social housing, the appetite for privately rented units is demonstrably high and is expected to rise over the next five years.
Derby Supply and Demand
Striking the right combination of supply and demand is vital for maximising the returns on a Buy-to-Let property, which is why finding a location with an undersupply of property and growing demand can result in a lucrative investment.
The supply of property across Derby has been lagging behind demand for years, with the city’s future growth set to only fuel this further and continue pushing house prices in Derby. The city’s population is currently surpassing 267,000 and is expected to increase by 5.3% over the next 20 years, highlighting the potential of investment opportunities in the area.
Properties for rent in Derby have always been – and always will be – a staple within the market, due to the city’s young population. Almost 50% of Derby’s population is under 35, and with a strong student population of over 30,000, the city has a strong foundation of residents within ‘generation rent’, looking for properties to rent in Derby.
The demand for property is already far surpassing the supply across Derby, but with the population set to increase considerably over the next two decades, this undersupply will continue to escalate.
Both house prices in Derby and average rents will likely reflect this growth in the coming years, driving a positive Derby property market forecast and cementing the city as a prime investment opportunity.
Want to know more about the Derby property market for 2026? Download the Derby Investment Guide today and discover everything you need to know about Derby property investment in the new year. In this guide you’ll find:
- Current market performance
- Forecasts for the Derby property market
- Key trends impacting the market
- Why Derby is a key investment hotspot
Derby Past Performance
House prices in Derby have been on an upward trajectory for many years, but the city still remains one of the most affordable in the UK to buy properties in. Over the past 10 years, Derby properties have seen a value increase of approximately 40%.
Rental yields in Derby are similarly impressive, with research indicating that it takes an average of just 21 months for an 8.59% rental yield to recoup the initial property investment you put down. Derby’s competitive rental yields highlight the demand for properties for rent in Derby and make the city an ideal property investment location.
Not only do investors have the opportunity to enter a market with more affordable prices, but the growing demand for properties to rent in Derby will maximise returns over the long-term.
Key Projects Driving Growth in Derby
The future of Derby is secured by ambitious regeneration schemes that are already translating into property value increases and economic vitality. These projects are fuelling investment forecasts and pushing up house prices in Derby.
1. The Derby City Centre Masterplan
The Masterplan is central to the city’s transformation, solidifying Derby’s position as a hub of innovation and modern living. It includes the rejuvenation of key amenities and the introduction of new workspaces, drawing in further inward investment, jobs, and residents.
Becketwell Regeneration: The creation of the new performance venue and residential quarter continues, aiming to generate over 2,000 jobs alone.
Target: The entire Masterplan is forecasted to deliver over 4,000 jobs and 1,900 new homes by its 2030 completion.
Investment Result: New jobs and upgraded amenities will sustain the soaring demand for rental properties and drive natural capital growth in house prices.
2. Strategic Educational Investment
The University of Derby’s latest masterplan represents a significant, long-term commitment to the city’s educational future. This overhaul ensures a steady pipeline of highly skilled graduates and students needing rental accommodation.
Scale: A £150 million overhaul, including the development of a new business school and the £13 million East Midlands Institute of Technology.
Outcome: This investment enhances Derby’s appeal as a premier educational hotspot, strengthening the ‘generation rent’ cohort.
3. Innovation and Residential Development
Complementary projects are rapidly expanding Derby’s economic footprint and housing capacity:
Infinity Park: This innovation and technology park is set to generate 3,000 high-value jobs and substantial investment, attracting a professional workforce that requires high-quality rental accommodation.
Nightingale Quarter: This major £150 million regeneration scheme is actively delivering approximately 800 new homes to help meet the growing demand for properties to rent in Derby.
Each of these developments is designed to attract a thriving, economically active population, reinforcing Derby’s positive property market forecast for 2026.