The UK property market is booming. In a time of economic uncertainty and instability, the buy-to-let market in particular offers a genuinely stable and profitable investment class. This impressive performance has laid the foundations for the market to reach new heights in the coming years, so here at yieldit we thought we’d take a look at some of the prime investment locations to capitalise on this ever-growing market, starting with Manchester.
Manchester is without a doubt one of the most well-known cities across not just the UK, but the entire world. Located in the North West of England, Manchester has been one of the pioneering regions in driving investment away from the capital and pushing it instead up North. The city is famous for its role in the Industrial Revolution centuries ago and has now blossomed into one of the most vibrant places to both live and invest in, with a proud cultural heritage, a strong digital presence and soaring buy-to-let market.
House prices
Manchester has experienced unprecedented house price growth over the last few years. According to Zoopla, prices have increased by an impressive 48% over the course of the last decade. In the last 12 months alone, prices have increased by 3.64%, surpassing the likes of London, Birmingham and Leeds.
This impressive growth is expected to continue both in Manchester and the surrounding areas. According to Savills Residential Property Forecast, house prices in the North West are set to increase by 28.8% in the 5 years to 2025, the highest growth of any region in the country and over 7.5% higher than that of the UK average. When looking at Manchester specifically, JLL estimates that the unofficial capital of the North is set to see an impressive 17.1% price growth in the period between 2020-2024.
Rental market
The culmination of ever-increasing house prices in Manchester, as well as a large portion of people no longer looking to get on the property market, has resulted in a large amount of the population continuing to live in rental properties. This increase in rental demand has, in turn, resulted in a surge in rental yields over the last few years.
In a recent report it was revealed that Manchester’s rental yields have been the best performing in the UK since 2015, and JLL expect this to continue in a similar vein. In their Northern Regional Forecast, they state that in the period between 2020-2024, rental values are set to increase by 16.5%, surpassing the UK forecast by 4.5%.
Lifestyle
It’s easy to deduce just why the rental demand is as high as it is in Manchester when you take a look at the way of life in the city and the opportunities on offer, when it comes to young professionals in particular.
Manchester is home to an endless stream of things to do. The city features a thriving hospitality industry offering a mixture of favourite chains, independent companies and market vendors. If food and drink isn’t your thing, the city is home to the Arndale shopping centre for all your retail needs, numerous theatres and venues to catch a show or a gig, as well as a plethora of other amenities.
In terms of opportunities, the influx of regeneration in recent times has resulted in some of the UK’s leading companies moving in and around the Manchester area. Home to the national head offices of businesses such as Google, Adidas and AstraZeneca to name a few, as well as the wealth of digital and media companies located in areas nearby like MediaCityUK, young professionals from all over the country continue to flock to the city for the way of life and better employment opportunities, bolstering both the local economy and buy-to-let market as they do.
Regeneration
Despite experiencing such a large amount of regeneration in recent times, Manchester – as well as its surrounding areas – is showing no signs of slowing down. Piccadilly Gardens is set to undergo a £10 rejuvenation in order to create a more ‘modern and welcoming’ public space, whilst the Town Hall is currently in the middle of a major restoration project, aptly titled ‘Our Town Hall Project’. Both projects are set to breath new life into these key city centre areas, only further enhancing the appeal of living in Manchester and, in turn, boosting the property market.
Whilst not in Manchester itself, the MediaCityUK 2 scheme is another regeneration project well worth mentioning. The £1 billion expansion of the MediaCityUK scheme located in Salford Quays is expected to double the size of the development, in what is being dubbed as the next step on the journey of establishing MediaCityUK into a sustainable mixed-use community. The initial development has already attracted the likes of the BBC, ITV and more to move up North, so this expansion is only set to bolster both the Manchester and Northern economy.
It’s clear to see why Manchester is so popular when it comes to property investment, and despite its impressive growth, prices in the region still remain way below those in London. With lower prices and higher rental yields, Manchester offers an excellent investment location for those looking to purchase buy-to-let property. If you’re interested in investing in this Northern hotspot, why not take a look through our range of tenanted, income generating properties in the city and get in touch today to secure your investment!
Stay tuned for later instalments of the ‘The Professors property market breakdown’ and get in touch with us today if there’s a region you want to see us cover!
