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Manchester is a leading, world-class city at the heart of the UK’s Northern Powerhouse.
It has been a centre of innovation, creativity and progress for centuries. The industrial revolution began in the city. And a long line of cultural, musical, sporting, and scientific achievements have followed.
In recent years, Manchester has developed at a rapid pace. It is now a vital economic engine for the UK, with a gross added value (GVA) of more than £60 billion – second only to London.
So, it should come as no surprise that Manchester’s property market is flourishing. The strong performance makes it an ideal choice for new and experienced property investors alike.
As a property investment company in Manchester, we can help you find the perfect property in the city. So if you’re interested in learning more, continue reading below or get in touch with our team.
Why is Manchester a good choice for property investors?
When considering where to invest in property, we always recommend looking for key fundamentals. Manchester has each of the property investment fundamentals we look for:
- Population growth
- Transport & connectivity
- Regeneration & investment
- Business growth & employment opportunities
- Standard of living
Together, these factors mean Manchester tops the leaderboard as the best location in the UK for property investors. Below, we’ll explore each in more detail.
Fundamental 1: Population Growth
Manchester’s population has grown quicker than the UK average. Data from the Office for National Statistics (ONS) show the city’s population has increased by 280,000 people since 1991.
Plus, the ONS estimates that Greater Manchester’s population will grow by a further 10% by 2043. The scale of growth is astounding, given it represents an extra 300,000 people in the area.
And here’s the interesting part: the age group seeing the largest increase in population size are 21 to 30 year olds. The ONS indicates a 51% rise in this age group since 2002.
Why is that?
Manchester has two major universities: The University of Manchester and Manchester Metropolitan. Between them, there are over 90,000 students living in the city.
After these students graduate, they tend to stick around.
Manchester has a graduate retention rate of 51%. That means for every two students, at least one will stay in the city after graduating. Moreover, 57% of students who leave Manchester to study elsewhere return afterwards.
Only London has better numbers, which means Manchester is a major pull for young talent. This is a major force behind the population increase in 21 to 30 year olds.
Fundamental 2: Transport & connectivity
Manchester is a well-connected city, both domestically and internationally.
The airport is the UK’s busiest outside London, handling up to 30 million passengers each year. There are routes across the entire globe, which allows business, trade and tourism to flourish.
On the ground, the motorway and rail network links Manchester with the rest of the UK. Leeds is a 45-minute drive northwards on the M62. Liverpool is 45-minutes westwards on the M65. Birmingham is two hours south on the M6. And London is two hours away on the train.
Not to mention, the second phase of the HS2 is due to open circa 2035. HS2 will cut travel times from Manchester to London in half. A journey that currently takes 127 minutes will instead take 67 minutes. This will be a catalyst for further growth in the region; delivering new jobs, new homes and new opportunities.
Fundamental 3: Regeneration & investment
Since the 1990s, billions of pounds have poured into Manchester from both the government and private investors. It has led to an almost complete transformation of the city centre, creating a thriving city. Key regeneration zones include:
- The Northern Quarter
- Salford Quays & MediaCityUK
And there’s more to come.
A £1billion project intends to create a brand-new neighbourhood in Manchester city centre. St John’s will host businesses, residential blocks and creative spaces. It’s scheduled to open in 2025.
Fundamental 4: Business growth & employment opportunities
Manchester’s business scene has exploded in recent years. Data from the Centre for Cities shows the city has the 10th highest number of startups per capita each year.
In fact, Manchester’s startup scene attracted over £500m in venture capital in 2019. It is the fastest-growing location in Europe for such investment.
And now major employers are opening offices in the region. The BBC began the trend in 2011 by moving headquarters to MediaCityUK in Salford Quays. The likes of Amazon, Google, Microsoft and others have since followed.
Unsurprisingly, this has led to more jobs. The Centre for Cities shows a 12% increase in private sector jobs since 2015, which is the 4th highest in the UK.
Employers are moving to the city to ensure they attract and keep the best talent. Remember, graduates tend to stick around Manchester.
Fundamental 5: Standard of living
Young adults want to live in Manchester. Population data (see above) supports this.
And it’s no wonder. For young professionals, the standard of living in the city is fantastic.
Social factors, like restaurants and nightlife, enjoy a stellar reputation. There are plenty of jobs, and living costs are much more affordable than London. In fact, data suggests the cost of living is 32% lower in Manchester.
The Manchester Property Market
In the previous section, we looked at the key property investment fundamentals. Manchester ticks off every single one of our fundamentals, making it an excellent choice for property investors.
In this section, we’ll take our analysis even further and look at how the fundamentals impact the city’s property market. Through the data, we’ll build a strong business case for investing in buy-to-let property in Manchester.
Property Value Growth
Capital growth is exceptionally important for property investors. It is the best means of making a substantial and profitable return on investment.
Over the years, Manchester has delivered fantastic capital growth.
The graph opposite contains data from the HM Land Registry. It shows the average property price has increased since the end of the global recession. The average value of a property in Manchester has increased by 40% since 2015.
That said, values have increased faster in some areas more than others. The largest increase in Manchester property prices has come in the central boroughs of Manchester (+27% in the past 5 years) and Salford (+26.9%). This is no surprise. Over the past 20 years, these areas have seen the greatest number of regeneration projects and a huge amount of public and private investment.
There is growth in the northern suburbs of Bolton and Bury too. Boroughs to Manchester’s east have not seen as quick progress.
Furthermore, research from JLL anticipates that Manchester property values will continue to increase. Their report, the UK Residential Forecasts, predicts an 18.5% rise in values by 2025. Manchester property investors who get in early will benefit tremendously from the increase.
Rental Value Growth
More young professionals want to live and work in Manchester city centre. As a result, the demand for high-quality rental accommodation is higher than ever. And that’s forced rental values to grow considerably over the past few years – making the ideal conditions for buy-to-let in Manchester.
In general, the entirety of the North West has seen strong increases in rental values. As of April 2021, the average rental price has increased by 6.3% year on year, whilst it’s up over 12% compared to April 2019.
This comes despite the recent uncertainty with the covid-19 pandemic. It exemplifies just how strong the rental market is in Manchester.
Manchester will see further increases, too. JLL’s UK Residential Forecast estimates that rental values in the city will rise by 12.5% by 2025. As such, property investment in Manchester offers buyers the opportunity to make excellent returns via capital and rental growth.
Rental yield is an excellent measure of how strong an investment property is financially. It calculates the rental income of a buy-to-let against the property’s value.
Manchester has always offered brilliant rental yields, both gross and net. This is because:
- Property in the city is generally quite affordable. The average value over the past 12 months is just over £200,000 according to Zoopla).
- Rental prices are good in relation to the property value, and they’re rising.
- The city has a limited supply of central, high-quality accommodation, but a very high level of demand from renters.
The combination of good-but-limited accommodation, high demand, and reasonable purchase prices means Manchester property investors can achieve excellent yields.
Looking at the map opposite, it is the most central areas which achieve the strongest average rental yields. For example, Salford and Central Manchester outperform suburbs like Bury, Oldham, and Trafford.
Is Property Investment In Manchester Right For You?
Many property investors are choosing to start or expand their portfolios by purchasing a buy-to-let in Manchester. Depending on your circumstances and objectives, the capital of the North may be right for you too.
Along with Liverpool, Manchester is one of the most balanced options available for both domestic and international property investors.
London, and the surrounding areas, offer the best capital growth in the country. Investors can buy and sell a few years later for huge profits. Yet, because property in the South East is so expensive to buy, rental yields are poor. Rental income may only just cover all costs.
Meanwhile, other cities in the UK provide very high rental yields, but property values don’t increase as quickly. Investors in those cities enjoy a passive source of income. Yet, they cannot leverage their property’s value if, for example, they wished to buy another property.
Manchester offers the best of both worlds. Buy-to-let apartments in the city centre increase significantly in value, whilst rental yields are strong thanks to the high demand.
You may only need a deposit of £50,000 to get started (sometimes less), and you can buy most buy-to-lets with a mortgage.
Best Areas For Property Investment In Greater Manchester In 2021
Greater Manchester comprises of 8 metropolitan boroughs (Bolton, Bury, Oldham, Rochdale, Stockport, Tameside, Trafford, Wigan) and 2 cities (Manchester & Salford). If you are unfamiliar with Manchester and you’re looking to buy an apartment or house in the city, it is worth getting an idea of the different areas.
Below, we have highlighted some of the best locations for buy to let property in Manchester.
Manchester's city centre is in constant demand from renters. It is home to the city's biggest regeneration schemes, such as NOMA, Spinningfields, and Ancoats.
The population in the city centre is largely made up of young professionals and students, making it a great hub for landlords wanting a prime tenant demographic.
Many choose to live here due to the proximity of workplaces, high-end restaurants, nightclubs, shops, and more.
The average property price in the city centre is £222,053. It has increased by 22% over the past 5 years.
Salford's fortunes have turned around completely over the past 10 years. This is largely due to the success of MediaCityUK at Salford Quays.
Before, Salford Quays were a worn-down region on the banks of the Manchester ship canal. Now, the area has been completely regenerated to create a sought-after hotspot of businesses, housing, and leisure. It has become home to huge companies, like the BBC, ITV, BUPA and other.
The local property market has soared as a result. MediaCity's success has brought property developers and investors alike to Salford. All are hoping to capitalise on the thriving tenant demand.
The average property price in Salford is £182,075. It has increased by 20% over the past 5 years.
Trafford is a stone's throw away from Manchester city centre (4 km). It is an area with several regeneration projects in the works and more in the pipeline. The council plans to boost housing, education, leisure and retail facilities.
The area hosts one of the city’s most interesting and valuable commercial centres, the Intu Trafford Centre. This is the second-largest retail park in the UK and brings over 35 million visitors a year.
The Northern Quarter
The Northern Quarter is known for its creative spirit. There's an abundance of independent clothing stores and music venues. Beautiful street art adorns the walls of local buildings. Trendy cafes, bars and restaurants offer some of the best Manchester has to offer in food and drink.
The Northern Quarter is a highly sought-after location by renters. Investors who buy a property in the area will never be short of tenants.
With rental demand so high in the Northern Quarter, it has overflowed and spilled out into Ancoats. The two areas are opposite one another, separated by a single road cutting between them (Great Ancoats Road).
Ancoats' industrial past is on full display throughout the area. Old mills and warehouses have been converted into modern apartment blocks. There are plenty of amenities and things to do, too. Ancoats is home to bars, restaurants, cafes, artisan bakeries and even a brewery.
The average property price in Ancoats is £214,800. It has increased by 23% over the past 5 years.
Castlefield begins at the south end of Deansgate. Although it's in the city centre, it is a walkable area dominated by canals and Roman ruins.
It is another area that has gone through extensive regeneration. Many new apartments blocks are being built alongside the canal to meet tenant demand. Castlefield is more relaxed in comparison to the hustle of Deansgate and Market Street. Even so, they're both within easy walking distance - no more than 5-10 minutes walk.
The average property price in Castlefield is £209,498. It has increased by 21.5% over the past 5 years.
Other areas to consider for Manchester property investment are Spinningfields, Oldham, Rochdale, Bury, Bolton and Stockport.
Each has their own strengths and opportunities, so please speak to one of our team to learn more.
Types of Property Investment in Manchester
Manchester buy to let property is very appealing for investors.
Tenant demand is extremely high due to the thousands of young professionals wanting to live in the city centre. This means landlords are benefiting from fast-rising rental prices.
In fact, Ideal Flatmate reported that between 2014 and 2019, the average rental price grew by 37.8% in Manchester. These are ideal conditions for buy to let investors.
Manchester was recently voted one of the youngest cities in Britain. The city is home to around 90,000 students.
Plus, it now has the highest percentage of overseas students of any UK city outside of London.
This means Manchester's student properties can offer investors plenty of tenant demand. This will help generate a reliable and profitable return on investment each year.
The growth of any city depends on the projects it undertakes. Manchester’s success in recent years is the result of many top projects improving the city bit by bit.
This is an important consideration for property investors. New social spaces, infrastructure and regeneration can contribute to a rise in property and rental values. Obviously, this can affect the return on investment.
In this section, we’ve reviewed some of the future projects planned for Manchester.
HS2 is a high-speed train line that will connect key locations across the UK.
HS2 will connect with Manchester at Piccadilly Train Station. It will reduce journey times with the rest of the UK. For example, Manchester to London will take 67 minutes. Manchester to Birmingham will take 40 minutes.
This opens up the possibility of increased trade and longer-distance commuting. Savvy investors will already be aware that properties around Piccadilly will become much more valuable, as a result.
As mentioned above, Piccadilly is due to undergo a major redevelopment.
The city centre’s first public park in over 100 years, Mayfield’s Public Park, is set to open in 2021. This is one part of major regeneration plans for the back of Piccadilly, especially the Mayfield area.
In recent years, Mayfield Depot has played host to the city’s famous Warehouse Project (a seasonal nightclub event). Now, developers aim to make even more use of the space. In addition to the park, there are plans for a hotel, new shopping areas, office space and over 1,500 homes.
Furthermore, the public gardens further down in Piccadilly Basin are set to receive a £2m facelift.
St John’s is a brand new, city-centre neighbourhood. Due to open in 2025, it will regenerate the area around the Old Granada Studios. It is over the road from the trendy Spinningfields – an area that is home to plenty of bars, restaurants and the city’s main financial district.
The master plan includes the creation of 620 residential units, 560,000 sq ft of workspace, 240,000 sq ft of retail and 13 acres of public space.
Circle Square is another “new neighbourhood” on Oxford Road. The area has become synonymous with Manchester’s student community. Both of the city’s universities have campuses along the road. Meanwhile, there are famous music venues, shops, parks, restaurants, bars and more nearby.
Despite all that, Oxford Road is an area yet to receive much major regeneration attention yet. We expect this to be the first of many new projects in the area.
Circle Square will provide commercial office spaces, retail and leisure facilities, student accommodation, luxury non-student residential apartments, a 158-room hotel, a car park with 1,000+ spaces, and a large public green area.
The developers aim to have the majority complete by mid-2021.
Why work with Track Capital?
We’ve built a reputation as an ethical, knowledgeable and experienced property investment company in Manchester.
We use our understanding of the local property market to find relevant opportunities. This comes at no cost to the client.
And we’re often able to get our clients deals that aren’t available to the public. For example, free furniture packs, Stamp Duty support, and even price discounts. For this reason, we tend to look for off-plan properties. These are projects that are yet to complete but have incredibly high potential.
Over the past few years, we’ve helped hundreds of property investors in the UK and abroad to purchase buy-to-let apartments in Manchester. The city, along with neighbouring Liverpool, is our first choice pick for new and experienced investors due to the stunning market performance and accessible prices.
Finally, we guide you through the entire journey. From a free consultation to extensive due diligence, to finding a mortgage provider and after-sales support. We’re here to help you achieve your property investment goals.
Frequently Asked Questions
Below you can find a range of common questions from previous Manchester property investors. If you require specific details and advice please do not hesitate to contact us today on +44(0)203 627 3987 or via [email protected]
Yes, Manchester is one of the best places to invest in property across the whole of the UK. The cost of buying property in the city is still relatively low, especially compared to London. Buying now means property investors will benefit massively from the expected increase in values over the next few years.
Furthermore, there is a huge demand for high-quality rental accommodation. This means buyers can achieve excellent rental yields across the Greater Manchester region.
To get the best returns, we recommend looking for properties in the most central areas.
According to Zoopla, the average price paid for a property in Manchester over the last 12 months was £209,794. This is still a reasonable price for such an in-demand investment hotspot.
Yes, house prices in Manchester have increased dramatically over the last few years. Data from the HM Land Registry shows the average price paid for a property in Manchester has increased by 37.9% between 2015 and 2020.
This growth is forecast to continue over the next decade and beyond.
Depending on where you invest, and even with the rising prices and demand, property investors can achieve excellent rental yields from buy to let in Manchester.
Central areas tend to generate the best yields, so be on the lookout for any properties close to, or in, the city centre. The likes of Ancoats, Deansgate, the Northern Quarter, Ordsall, Salford Quays (including MediaCity), and Spinningfields are often good choices.
The HS2 is coming to Manchester. Once it arrives, the new train line will half the current travel time to London. It will take just 67 minutes to get to the capital.
As part of the HS2 project, the redevelopment of Manchester’s Piccadilly Train Station and the surrounding area will create 40,000 new jobs and 13,000 new homes. This represents one of the largest urban regeneration schemes in the UK.