Which Area's of Manchester Are Hot Spots for Property Investment Growth?
With Manchester, benefitting from a £1bn investment as part of the UK Government’s ‘Northern Powerhouse initiative’. Manchester is a happening city, with a hip and trendy vibe and off-the-scale demand for city centre and rural area living. Manchester is also home to 80 FTSE 100 companies. Manchester’s rise presents a lucrative opportunity for residential investors; the city took the top spot in the 2025 rental dwellings projection, rising from third place as of 2019. Manchester is set to outpace both Outer London (#1 in 2019) and Birmingham (2) over the next four years, showing its strong prospects for investors. Manchester’s rental yield has grown by 10% in a year, demonstrating the strength of the Manchester market.
The Property specialist company JLL, rates Manchester amongst its highest residential place for growth over the next 5 years. With annual average growth of 4.2pc compared with 2.4pc across the UK.
Pivotal to Manchester’s success is a revival in demand for city-centre living – a trend that was at its height before the 2008 recession, which collapsed along with house prices due to sheer oversupply.
Zoopla Cities House Price Index also revealed Manchester is home to the second strongest house price increases in the UK with prices having risen by 4.6% from October 2018 to October 2019. Additionally, the North West of England as a whole is forecast to see property prices rise by 2.5% in 2020 and 24% across the next five years, according to the Residential Property Forecasts by Savills.
In 2000 there were 10,000 people living in the heart of the city. Now there are nearly 70,000, many of them students or young professionals with a desire to live close to where they work and play.
“You can see the reasons. They already know they enjoy living there and there are plentiful employment opportunities and affordable housing. More new businesses are coming to the city than anywhere else in the UK, outside London. Many of them are first-time investors in the city, which is a reflection of Manchester’s growing profile. Professionally managed blocks of rental apartments with leisure facilities and concierge services are forcing private landlords to up their game, which is a positive thing.”
For investors with an eye on Manchester, its student population of more than 85,000, spread among four universities, plays a crucial role in the rental and property investment market. The city has the highest retention rate of students after London, with 50pc choosing to stay after they graduate. Six in 10 Manchester-born students who go to university elsewhere also return to their home town after graduation.
The young demographic constitute two-thirds of the city centre’s housing stock. A fast-emerging trend is the build-to-rent market, which accounts for a large proportion of the 30 new residential developments currently being built.
WHY INVEST IN MANCHESTER?
· Severe constraint on supply of city centre housing
· High city centre population growth rate
· Huge student population
· Major urban regeneration
· Only London attracts more new businesses
· World class education centre (e.g. 40+ universities)
· Two-thirds of the city centre’s housing stock is privately rented
· Since 2000 Manchester’s number of new jobs has grown by 84% (UK’s highest job creation rate)
There are 9 areas of interest within the Manchester area which offer potential to investors:
Northern Quarter:
Situated between Piccadilly and the Ancoats, the Northern Quarter retains a unique character and charm, one set to continue through its ongoing development and regeneration. Manchester's creative, urban heart is home to countless independent fashion stores, record shops, cafés, bars and restaurants and the world famous Afflecks Palace, providing affordable outlets for independent designers and traders across four floors.
Piccadilly:
The main gateway into the city including Piccadilly train station. Shops, restaurants, bars, pubs and hotels surround Piccadilly Gardens. Between the late 1990s and early 2000s, Piccadilly station was refurbished, taking five years and costing £100 million (in 2002); it was the most expensive improvement on the UK rail network at the time.
Castlefield:
Castlefield in Manchester, located at the south-west end of Deansgate, is the industrial and Roman heart of Manchester. You could easily mistake Castlefield for a quiet and quaint old town, but its history and architecture are so much more than that. Cobbled streets, brick warehouses, bridges, viaducts, and canal boats; every corner of Castlefield lets you know that you’re in a historical hub. .
Deansgate/Deansgate St Johns: is a mile long stretch of road that connects pretty much every part of the city centre. If you are ever lost in our fair city, ask anyone the way to Deansgate and you will soon pick up your trail. It starts (or ends whichever way you look at it) with the Cathedral and ends at the dominating Beetham Tower with a cross section of most central streets in between. Deansgate train and tram stations are both within five minutes walk of Castlefield. The free Metroshuttle bus (route 2) runs along Deansgate, near to Castlefield. It is home to a Roman fort, networks of canals, old mills, new bars, sophisticated restaurants and a wide range of accommodation. Deansgate is a mile long stretch of road that connects pretty much every part of the city centre. If you are ever lost in our fair city, ask anyone the way to Deansgate and you will soon pick up your trail. It starts (or ends whichever way you look at it) with the Cathedral and ends at the dominating Beetham Tower with a cross section of most central streets in between. St John’s handy central location and superb transport links have helped it become a prime market, with sales there last year regularly exceeding £500/sqft. Easily identifiable by its growing number of landmark high rise developments for those wishing to be at the heart of the city. St John’s Deansgate has become a prime market, with sales there last year regularly exceeding £500 per square foot.
Salford Quays:
Salford Quays is a unique waterfront destination, situated just 15 minutes by tram from Manchester city centre and an ideal destination for a day out or weekend break. At The Quays you'll find a wealth of world-class entertainment, leisure and cultural facilities on offer, including Imperial War Museum North, Emirates Old Trafford, The Lowry, Ordsall Hall and a range of water-based and sporting activities.
Salford City Fringe:
Salford Quays now the UK’s second-biggest media hub, home to 80 media organisations. Excellent connectivity, relatively low property values and a strong development pipeline which have in turn made the Salford City Fringe a great place to invest!
Ancoats/New Islington:
Ancoats, whose regeneration is largely funded by the owners of Manchester City Football Club, offers an attractive blend of new homes, businesses and eateries and the world famous Manchester City football club. This area is undergoing huge investment and is a property hotspot within Manchester.
JLL identifies nine Manchester “sub-markets” that offer potential to investors, including the centrally located Northern Quarter, Piccadilly and Castlefields, with its urban canalside living. St John’s Deansgate has become a prime market, with sales there last year regularly exceeding £500 per square foot.
“In the near future, we could see landlords offering similar white-label services such as local discounts and access to a network of handymen to stay competitive”
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