Why You Should Consider Manchester Property Investment

Capital of the North

WHY SHOULD YOU INVEST IN THE MANCHESTER PROPERTY MARKET?

As an investor looking to diversify your portfolio, you understand the importance of choosing markets with solid fundamentals and growth potential. Manchester, one of the UK’s largest cities located in the northwest of England, checks all the boxes for an investor seeking a great investment.

With a thriving economy, four leading universities, and significant infrastructure improvements on the horizon, Manchester property investment is poised for even more growth in the coming years.

Location

Manchester

Population

576,500

Economy

£ 62 Billion (Greater Manchester)

Employment

30.7% (Since 2016)

Tourism

£7.9 Billion (Greater Manchester)

Investing in Manchester

Manchester, a vibrant city in northwest England, offers excellent investment opportunities for property investors. With its strong economic growth, cultural diversity, and thriving industries, Manchester has become a prime destination for those seeking profitable investments in the property market.

Manchester has experienced remarkable economic growth in recent years, positioning itself as a leading city in the UK. The city has attracted significant investments across various sectors, including finance, technology, and creative industries. These investments have contributed to creating new jobs and expanding businesses, making Manchester an attractive choice for property investors looking for long-term growth potential.

The Rainy City boasts a vibrant rental market, driven in part by its large student population and a growing number of young professionals. The city is home to several renowned universities, attracting students worldwide. Investing in purpose-built student accommodation or residential properties in popular student areas can provide a consistent rental income stream.

Manchester’s city centre has undergone a remarkable transformation, making it an appealing area for property investment. The regeneration projects have revitalised key districts, creating a desirable urban environment with modern infrastructure, cultural attractions, and recreational spaces. Investing in city centre properties can offer excellent potential for capital appreciation and rental demand.

Manchester is renowned for its rich cultural heritage and vibrant arts scene. The city is home to world-class museums, galleries, and theatres, attracting visitors from afar. Manchester’s passion for sports, especially football, is well-known with its two Premier League clubs, Manchester United and Manchester City. The city’s cultural and sporting offerings contribute to its appeal and make it an attractive place for property investment.

Forecast for Growth

Manchester’s robust economy, infrastructure investment, job opportunities, and expanding population indicate a bright outlook for the residential property market. The city’s property market warrants serious consideration for investors seeking profitable UK opportunities due to its potential for healthy returns through rental income and capital appreciation. Manchester’s most desirable and well-connected central districts are projected to see immense demand and price growth, enlisting the city as a top property investment hub.

  • Manchester’s average property price projection for 2024 is £227,699, compared to £219,168 in 2022.
  • The city is expected to experience average rental yields of 6.1% in 2024.
  • Forecasts estimate a rental growth rate of 21.6% between 2023 and 2027.

A Window of Opportunity

The best buy-to-let areas in Manchester are those experiencing high demand for rental properties. Examples of such developments that provide lucrative opportunities to investors include Victoria House and Pavilion Wharf.

Manchester is home to one of the largest student populations in Europe, with over 120,000 students across four universities. Student housing is always in high demand, and purpose-built student accommodation can achieve yields nearing 8% due to a shortfall in supply. Even standard buy-to-let properties in Manchester will experience consistent demand from students looking to rent with friends.

Major employers like the BBC, Kellogg’s, Adidas, Siemens, and Amazon have operations in Manchester, creating new high-skilled jobs. The city has a fast-growing digital and tech economy, employing several people. Such rapid job creation results in relocating professionals to the city, many of whom will initially rent before buying property.

There is anticipated long-term property price growth as experts predict that average property prices in the North West region, including Manchester, will grow by 18.8% by 2026.

Connectivity

In addition to a recent influx of businesses and residents, Manchester is a convenient international gateway — well connected by road, rail, and air. Recently, it was announced that Manchester International Airport—currently the UK’s largest airport outside of London—will receive a £1 billion investment. The project, which will double the size of the airport’s second terminal, will be the largest construction ever in Greater Manchester, spanning 10 years and doubling the number of airport jobs to 40,000 over the next 30 years.

Manchester International Airport already accommodates more than 20 million passengers per year and facilitates flights to more than 200 destinations, including hub cities such as Dubai, Hong Kong, and New York. The new development plans will enable the airport to accommodate a further 10 million passengers every year.

Manchester’s Thriving Economy and Infrastructure

The following facts offer insight into the constantly growing economy and infrastructure of Manchester.

    1. Manchester has a fast-growing economy with strengths in tech, creative and digital, financial and professional services, and life sciences. The city is home to the headquarters of several top companies like The Hut Group, AO, and Boohoo.
    2. Manchester is a startup hub with programs to support new tech companies. Strong university connections provide a pipeline of highly-skilled talent.
    3. Robust population growth, especially among younger age groups, fuels housing demand. The city’s economic and population expansion points to a bright future with opportunities for investors.
    4. Massive regeneration projects are underway, including NOMA, a 20-acre mixed-use development in the city center. The first phase is complete, with office space, retail, hotels, and apartments. 
    5. The Mayfield Park project will transform a historic train depot into a world-class park. St. Johns will redevelop a landmark area into a new commercial and residential quarter. These major regeneration zones attract property investments in Manchester, boost the local economy, and increase housing options.

In conclusion, extensive infrastructure improvements, massive urban regeneration, and a thriving, diverse economy drive substantial future demand in Manchester. For investors, this means the potential for solid capital growth and stable rental income over the long term.

Why Invest in Manchester Property?

Manchester is a world-class city that is growing more rapidly than any of its peers. Named as the UK’s most liveable city year after year by the Economist, and with a booming population to suit, it’s easy to see why Manchester is at the very top of the list for investors from all over the world.

  1. Manchester offers attractive rental yields for property investors. The city is among the top five locations in the UK for rental yields, with an average yield of 5.55% in 2021.
  2. Manchester has seen impressive capital growth in its property market. Data from Zoopla shows that between 2011 and 2021, property prices in Manchester increased by approximately 53.87%.
  3. Manchester is home to several prestigious universities, including the University of Manchester and Manchester Metropolitan University. This creates a strong demand for student accommodation from over 120,000 students, indicating a consistent rental market.
  4. Manchester has a robust economy that continues to grow. The city’s Gross Value Added (GVA) is projected to increase by 2.5% between 2024 and 2026. Such a thriving economy contributes to property demand and potential returns in the city.
  5. The city has witnessed significant regeneration and infrastructure developments in recent years. That includes projects like MediaCityUK, the Northern Quarter, and the Manchester Airport Transformation Programme. Such investments enhance the desirability and value of properties in the area.

Manchester has seen substantial infrastructure investment, business growth, and job creation. Major projects like the Northern Powerhouse and airport expansion have significantly boosted the city’s economy.

Property Price Growth in Manchester’s Key Areas

Investing in Manchester UK property has become increasingly appealing to many investors, thanks to significant price growth observed in the city’s real estate market over the past decade. This growth is evident in key property hotspots and emerging areas, making it an enticing opportunity for those looking to invest.

Here’s an overview of some areas in Manchester with potential property price growth:

Ancoats

Once the cradle of the Industrial Revolution and a thriving mill town in the 18th century, Ancoats is now a regenerated area featuring modern flats, restaurants, and bars. Investors can take advantage of the opportunities in Victoria House.

Salford Quays

Previously Manchester’s bustling docklands, the area has undergone significant regeneration and is now home to MediaCityUK, the Lowry Theatre, Viadux, Pavilion Wharf, and various modern apartments.

Northern Quarter

Known for its bohemian vibe, Northern Quarter is a trendy area with independent shops, art galleries, and bustling cafes.

Spinningfields

This is Manchester’s financial centre, packed with sleek office buildings, upscale restaurants, and designer shops. It’s one of the city’s newest areas, created in the 2000s.

Each area contributes to Manchester’s diverse and vibrant cityscape, each with its unique history and character.

Best Property Type for Investment in Manchester

New Developments

Investing in off-plan or new-build properties can offer significant returns. Manchester has several ongoing development projects, and these properties can offer high rental yields and strong potential for capital growth. Key property developments in the city include Victoria House, Viadux, and Pavilion Wharf.

Residential Properties in Regenerated Areas

Areas like Salford Quays and Ancoats have undergone significant regeneration and are becoming increasingly popular. Residential properties in these areas can offer good rental yields and potential for price appreciation.

City Centre Apartments

Apartments in the city centre, particularly in areas like Deansgate and Northern Quarter, are in high demand. They attract young professionals working in the city, ensuring a consistent rental market.

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Frequently Asked Questions

Yes. Manchester, indeed, has a lot to offer when it comes to investment opportunities, particularly in the property market, including:

  • Strong economy
  • High rental yields
  • Population growth
  • Infrastructure development
  • Capital growth
  • University city

However, as with any investment, conducting thorough research and considering getting professional advice from UK investment specialists before deciding is essential. The investment specifics, such as the location within Manchester and the property type, will also significantly affect the potential returns.

Investing in Manchester property can be worthwhile, given the city’s strong economic growth, high rental yields, and increasing demand for housing.

Here are some reasons why you should prioritise investing in Manchester property:

  • Manchester has one of the fastest-growing economies in the UK, attracting businesses, students, and professionals, which fuels demand for housing.
  • Manchester’s rental market is robust, with a high student population and an influx of young professionals. This increases rental yields, particularly in nearby universities and the city centre.
  • Manchester has experienced significant house price growth over the past few years, which will likely continue. This offers investors the potential for capital appreciation.
  • Numerous regeneration projects are underway in Manchester, which will likely increase the value of properties in these areas.

However, as with any investment, there are risks, and it’s essential to do thorough research and consider seeking advice from your property investment manager. While the trends and factors mentioned above are promising, many factors can influence the market’s future.

Yes, now is a good time to invest in property in Manchester, UK. The market has experienced steady and sustainable yields over the past decade, making it an excellent location for domestic and international investors.

Manchester is a top location for property investment in 2023 and beyond, with house prices predicted to increase by about 5% this year. The city’s property market offers low-cost, high-yield investment opportunities, promising solid rental yields and growth potential.

Nonetheless, conducting comprehensive research or seeking professional advice from your wealth manager before making major investment decisions is crucial.

Considering historical data and future projections, the best types of property to invest in are new developments, residential properties in regenerated areas, and city centre apartments. These property options offer promising capital appreciation and rental yields, resulting in generous returns in the long term.

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