Manchester Investment Property
Often referred to as the “spearhead of the Northern Powerhouse”, Manchester is a diverse, iconic and progressive city that has seen major transformation over the past decade, and continues to evolve into one of the country’s most exciting and thriving areas. Ideally located in the north-west of England, it is part of the UK’s second most populated urban area, and is also the third most visited city in the UK after London and Edinburgh.
- 20-30% predicted property price growth over the next three to four years – Hometrack
- Number one place in the UK to be a landlord – GoCompare
- City centre population growth of 149% since 2002 – Centre for Cities
- More than 50% graduate retention rate – Higher Education Statistics Agency
- £300m funding package from government to kickstart new homes and better infrastructure – UK Government
With the recent revival in demand for city-centre living, inner Manchester has seen its population leap by 149% between 2002 and 2015, from 14,300 to 35,600 people, according to data from the Centre for Cities. It has also seen more job growth than any other city since 1998, with an 84% increase in city centre employment opportunities.
Students and graduates
Home to three top universities – the University of Manchester, Manchester Metropolitan University and the Royal Northern College of Music – the city’s student population is continually growing, with an estimated 105,000 people currently enrolled there, and huge numbers of graduates staying on in the city. Between 2010/2011 and 2014/2015, more than half of higher education leavers remained in the area and gained employment, providing a massive boost for Manchester’s rental market demand.
“City living has gained strong momentum in Manchester over the past three years and, together with an active student market, has pushed demand in both the sales and lettings markets noticeably higher.” – Neil Chegwidden, JLL residential research
Investment in Manchester
Deloitte’s most recent annual Regional Crane Survey revealed Manchester to be one of the fastest growing cities in Europe, with 11,135 residential units currently being built, and more than 1.5 million square feet of office space completed last year. Skyscrapers are one major addition that is significantly transforming Manchester, with six towers of more than 25 storeys currently under construction
Greater Manchester was also one of three areas in England to be allocated part of a £300m funding package from the government to go towards building homes and supporting infrastructure, after being touted as one of the country’s most ambitious areas with some of the highest demand for housing in the country at the moment.
Excellent transport links
Manchester City Council recently unveiled plans to completely overhaul Manchester Piccadilly train station and the surrounding area as part of the upgrade work that will be undertaken for the new HS2 line, as well as the planned Northern Powerhouse Rail programme which will increase connectivity in the north.
The ambitious project has been described as a “once in a century opportunity for Greater Manchester and the north” by the council, with hopes that the station transformation will effect similar changes to those seen in London’s King’s Cross area.
“The strong GVA performance both historic and projected for Manchester demonstrates that location is not a binding constraint on growth.” – Debbie O’Hanlon, national markets leader at Ernst & Young in the UK
House price growth
While property prices remain below the national average, creating a perfect starting point for investors, Manchester achieved the highest house price growth out of any major city of 7% over the 12 months to June 2018, according to Hometrack. Properties now cost an average of £163,000 in the city, and could achieve gains of between 20% and 30% over the next three to four years based on current trends and housing cycles.
Best place to be a landlord
With such a high demand for rental property in the city, it is no surprise that Manchester can offer some of the best yields available in the country, with some areas achieving returns of as much as 10% for investors.
Online comparison portal GoCompare recently ranked Manchester as the number one place in the UK to be a landlord. The study looked at factors such as average property price, average yield, population under 35, number of properties available, number of letting/management agencies, number of new housing developments, properties currently available to rent, and rental price growth.
Manchester city centre’s low average property prices of £173,381, according to GoCompare, combined with excellent yields of an average 5.5%, contributed to its top position, along with the city’s impressive rental price growth of 5.76%. The number of new housing developments was also fairly high at 689, while there are more than 322,000 under-35s currently living in the city – many of whom will be privately renting tenants.
“We’ve reached the point where Manchester should be judged by different criteria from other UK regional cities. Manchester is now in a different league, genuinely competing with other Europeans and international cities.” – Simon Bedford, real estate partner at Deloitte