Manchester is a key economic area and one of the most high-profile cities in Europe. The city is home to the UK’s second-largest city and regional economy and is also a key area of the Northern Powerhouse. The city has benefitted from the devolution of power and is able to choose some of its own budgets and spending. This has made it free to develop policies designed to attract investment from overseas.
Constant large-scale investment
The city is also known for its thriving media scene, musical history and footballing heritage. Investment continues to transform the city for the better, with new facilities springing up all the time and its skyline constantly evolving. The European Structural Funds programme delivered approximately £366 million to the city, enabling it to create jobs, invest in businesses and fund education. The city is also regarded as one of Europe’s most impressive tech hubs and is noted for its exceptional transport links, leisure facilities and affordable properties, with growing numbers of people relocating from south-east England and overseas to take advantage of its many benefits.
Key growth generators
One of the main generators of recent growth is the Greater Manchester City Deal. This fund is largely centred upon what’s known as an ‘earn back’ scheme. This has enabled the region to recoup extra tax revenue from gross value added (GVA) increases from infrastructure development. The deal has created an apprenticeship and skills hub, raised the number of opportunities offered by the Business Growth Hub and enabled the city to attract further inward investment. It has also established a housing fund enabling further property developments and made billions available for investment. The impact of the scheme is predicted to deliver £1 billion each year to the city by 2025. Money from the Regional Growth Fund (RGF) has helped create almost 6,000 jobs, despite the original target being just 3,700. The Manchester Enterprise Zone, The Corridor, One St. Peter’s Square and Manchester Central also provide further clear evidence of the region’s continued extraordinary growth.
Career and leisure opportunities
The City of Manchester is generally regarded as the heart of the North West. It offers outstanding career opportunities in areas like law and finance, public service and the media. It is also home to 100,000 students and frequently plays host to some of the biggest and most prestigious names in entertainment. Amazon is currently setting up a base in the city, whilst a new GCHQ office is also set to open soon.
Other key attractions
The city’s colleges and universities have produced 25 Nobel Prize winners, with the Manchester Arena being the largest indoor concert venue in Europe. The city is also home to a huge range of cinemas, art galleries, boutiques and independent shops and is within a short drive of some of the UK’s most picturesque scenery, including the Peak District, Lake District and Yorkshire Dales. Manchester Airport was named the UK’s best at the 2015 Globe Travel Awards, with the city producing 3.5% of the nation’s GVA. Its ever-evolving economy has enabled the city to weather the storm even during some of the most troubled economic times.
Greater rental yields
Rents are also on the rise due to the growing demand for accommodation across the city. In fact, rental costs had soared by 30% over a four-year period, according to research carried out by the Manchester Evening News. The Manchester City Council area was the joint-most expensive area to rent a Greater Manchester home in between Oct 2017-Sept 2018, with figures standing at £775 per month on average, with Trafford sharing first place.
Residential and commercial property expansion
More and more property investors priced out of areas like London are now looking to Manchester to help them achieve their targets. New facilities including bars, restaurants, shops and leisure venues are constantly appearing on the streets of Manchester, which is also eclipsing many of its big-name rivals when it comes to house price growth. Research undertaken by Hometrack found that prices had grown by 6.6% on average year-on-year. The average price for a Manchester property stood at £168,900.
Growth outside the city
Growth is also being seen in other areas of Greater Manchester miles away from the city. Bury was showing the second quickest level of growth at 20%, with Salford rents increasing by 18%. Bolton has a rise of 17%, whilst Stockport experienced a 13% rise. Investors drawn to the area don’t have to miss out if they are unable to take advantage of opportunities in the Manchester City Council area. Greater Manchester is home to some 2.5 million residents, with a large number of these seeing substantial house price growth. Many of these areas offer quick and easy access to the city centre, making them ideal for commuters in rented properties. Each of the ten Greater Manchester boroughs have their own decision-making powers and is part of the Greater Manchester Combined Authority led by mayor Andy Burnham.
More buy-to-let options
Investors seeking buy-to-let property opportunities in the M1 postal area can expect to enjoy yields of around 5%. Suburbs just a few miles outside of the city centre like Levenshulme are home to a large number of affordable buy-to-let properties offering yields of around 5-6%. Yields of approximately 4% are on offer when you buy in the more sought-after, leafy locations of Chorlton and Didsbury. Castlefield and New Islington are a short walk away from the city centre and play host to state-of-the-art luxury accommodation. Student-friendly areas including Fallowfield and Rusholme offer quick links to the big Oxford Road universities. Conventional M14 homes can deliver yields of more than 7%, but you could see a return of at least 12% by investing in a house of multiple occupancy (HMO). Ensure you do your research, and your buy-to-let portfolio could bring you fantastic rewards; check out our tips for investing in the buy to let market whether you’re an old hand or just starting out.
If you are looking for new areas to invest in property and are seeking exciting locations that are well and truly on the rise, Manchester and its surrounding towns and cities may well deliver the generous yields that you desire. For our top picks for investment in Manchester, visit this page.