Manchester has enjoyed a change in fortunes that have made it both the envy and the pride of the rest of the UK.
Massively increased demand for city centre living, urban regeneration projects and swelling student numbers with enviable graduate retention rates have combined to create a huge demand for high end apartments and other living spaces to cope with the city’s growth.
Developers and investors have responded in kind and the buy to let market has mobilised to supply that demand. The buy to let market is now responsible for the majority of the 30 residential developments currently being built in Manchester. Property investment giants RW Invest have a very interesting guide on why Manchester is a great place to invest.
That isn’t to say that the market is saturated. Far from it actually. There is still plenty of room for growth, building and investment in the UK’s second city but what are the other factors that make Manchester the most exciting new build investment opportunity in the UK?
Growing House Prices and Rent
While the London housing market groans under the weight of slumping prices, a surfeit of properties on the market, disinterested or spooked buyers and an over-saturation of investment, better prospects and projections are found in the North West.
House prices and rent rates have spiked even in the last year alone. House prices in Manchester climbed by an impressive 10% over 2017 with rental prices following the upward trend with a 3% rise in the same time.
Residential price growth is also enjoying a pronounced upswing with its annual average growth hitting 4.2%. This is almost double the national average of 2.4%. Following in its wake, the projections for rent increases are extremely healthy, with 3.5% growth expected per year until 2020.
These figures buck the national average by some distance and with residential population figures already hitting all-time highs with more growth expected, investing in new builds in Manchester promises to be a very profitable venture.
Growing Population and Student Retention
Thanks to its well-established universities, Manchester has not only seen its number of students grow exponentially but it is enjoying the benefits of a high rate of student retention. More graduates that any of the universities in Greater Manchester are deciding to stay in the region after their graduation ceremony to live and work. There is a long list of things to do in Manchester so not shockingly many students decide to stay post graduation.
By 2015, Manchester was able to boast a student retention rate of 51.5%, the second highest in the UK outside of London. Estimates for 2018/19 conclude that the rate of student retention will hit 70%. Manchester is streets ahead of other popular cities and higher education institutions such as Belfast, Birmingham and Edinburgh when it comes to student retention.
The city centre has seen a startling 700% increase in residents since the turn of the century. As well as retaining graduates, Manchester is also seeing 60% of its outbound students returning home after their studies have been completed.
A great of Manchester’s city centre residents are students and young professionals, whose demand for high quality, luxury living space needs to be met by supply. In other words, new builds. With the demand being met as fast as it can, Manchester really is the most exciting new build opportunity in the UK.
What Does That Mean For Investors?
The influx of young professionals and students that flock to Manchester for education and work purposes conform to the primary demographics for buy to let property investors keen to make big money.
For a buy to let property investor the returns will be even bigger given the huge disparity between purchasing prices in Manchester when compared to London. Plainly speaking, you will get a lot more for your money the further north you go. Manchester promises incredible returns and yields for a fraction of the outlay you would be expected to put down in London.
With growing house prices and rental rates that show no sign of abatement in the short or long term there has never been a better time to invest in new builds and buy to let property in Manchester.
