It has been well documented that the property market in Manchester has soared beyond expectations in recent years, but according to a study conducted by Jones Lang LaSalle, the growth experienced so far in the city is nothing compared to what’s about to come. The predicted growth in the value of Manchester City Centre properties was announced recently, alongside news that the city is also attracting increasing attention from international property investors, the calibre of whom were previously only interested in London-based investments.
In terms of what is attracting investors to Manchester, experts believe this to be a combination of factors, including the exponential economic growth that the city has experienced over the past 5 years. With the introduction of the MediaCity development in Salford which has attracted TV giants The BBC and ITV, as well as high profile companies such as Barclays announcing an expanding presence in the region, Manchester has been firmly placed on the map for professionals looking to further their careers. Furthermore, Manchester is now the biggest university city in the UK, housing two of the largest universities in the country. The large student population is vastly contributing to the demand for property in the area, making it a prime investment opportunity in terms of rental yield.
Of all the property investment opportunities outside of London, Manchester is also unique as it is the only major UK city that is currently experiencing a shortage in the supply of homes. With the population increases that have come alongside the growth in business interest, Manchester is proving to have difficulties in meeting the housing demands.
Perhaps the most influential factor for the growth of investment interest in Manchester properties, however, is that investors are beginning to be priced out of the vastly expensive London property market. Those previously looking into London investments have been put off, not only by the costly sums involved, but also by the growth of the market. In London, the average growth in annual rents rose by a mere 0.96% in 2014, compared to 2.99% growth of rental values in Manchester. Estimates suggest that this growth will continue in Manchester as it slows in London.
Estimations made within the study show that capital growth of around 26% is also expected alongside the growth in rental values. A two-bedroom apartment occupying a prime location in Manchester city centre is currently valued at around £280,000, and this is expected to rise to around £354,000 over the course of the next four years.
This evidence is just further proof that there has never been a better time to purchase property in Manchester, whether it be for personal or investment purposes.
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