Manchester has proven to a great investment location for many seasoned investors over the year and current projections show that the city is set to continue rising in terms of capital growth whilst maintaining good rental returns for the future. Many top agents such as Savills and JLL indexes are showing Manchester to be a desirable place to live with strong economic fundamentals whilst maintaining the relatively low property prices in comparison to London. Here are 7 reasons to invest in Manchester right now:
- A city experiencing big levels of capital growth.
Manchester has often attracted investor attention because of the obvious fact prices are a lot lower than in the capital, but the levels of growth are the main reason to invest here. Manchester house prices have risen by 18% in the last 10 years rising from £152,282 to £181,292, and JLL are forecasting a 28.2% increase in the next 10 years. London was one of the major cities able to rival the likes of Manchester for capital growth but, since Brexit, property has been fairly stagnant in the capital. As a result, the smart money is being invested in Manchester highlighting it as a great place to invest.
Manchester is able to combine big levels of capital growth along with good rental yields, which is becoming a trend particularly in the North West of England. LendInvest detailed the 10 best Buy-To-Let hotspots across the UK in 2017 and Manchester was featured with an average yield of 6.11% and a rental price growth of 7.53% expected. Average yields in Manchester have grown by an average of 6.02%, compared with a rise of just 4.71% over the same period in the highest yielding borough of London. This all points to Manchester delivering on both fronts in terms of capital growth and a respectable rental income.
Manchester has one of the highest growing populations combined with one of the lowest levels of housing stock in the UK. The city is growing at three times the national average, rising by 19% between 2001 and 2011, and if this rate of population increase along with the amount of new properties being built continues, then Greater Manchester will have 1,500 more households than homes by 2026. Many investors are capitalising on this by investing in Manchester now whilst prices are still affordable.
- Student population and young professionals.
Manchester has the largest student population of anywhere in Europe with over 100,000 students calling Manchester their home. The shortage of property for both those currently studying and recent graduates is alarming in comparison to the overwhelming demand for property needed to house them. This is pushing the prices on the property that is available upwards highlighting this as a reason why to invest in Manchester.
The government led Northern Powerhouse regeneration project has played a role in transforming Manchester into the international metropolis city it is today, and while there is no official capital of the scheme, Manchester is the largest city and has experienced many of its benefits. 70,000 new jobs are expected to be created in Greater Manchester’s financial and business sector over the next 10 years and HS2 is already having an impact in terms of capital growth as many investors are buying into the city centre early before prices go up because of it. £1 billion will be going into Manchester Airport which will improve the infrastructure and double its annual passenger capacity to over 55 million. All of this will continue to make Manchester a bigger city that is sure to increase in value making it an excellent reason to invest there.
- Everyone’s identifying it as an investment hotspot.
All of the major investment agents, companies and news outlets are highlighting Manchester as one of, if not the best, places to invest in right now in the UK. The Telegraph published their article in early 2018 describing 2017 as a “phenomenal year” for those who invested in Manchester and that they “expect 2018 to be even better”. JLL are predicting a 28.2% growth there over the next decade and Savills have described “the demand for commercial Grade A office stock is so high that it’s spilling into secondary stock and pushing up rents there”.
Manchester has the largest economic hub after the capital and many huge organisations and businesses have established bases there. The BBC most notably relocated their staff to Manchester from London in 2011 to the now established Salford Quays a short distance from the city centre. Other companies that have HQs in Manchester include Marks and Spencers, RBS, The Co-Operative and Siemens. This combined with growth in the engineering and technological sectors contributes to a property market currently outperforming anywhere else in the UK.
Manchester is consistently ranked as both a fantastic city to live in as well as invest in which appeals to many investors looking to maximise their return on investment in a city they know is a fundamentally sound option. The North West in particular encompasses this, but Manchester currently stands above the rest in terms of where the smart money is being invested right now.