House price growth in Manchester was higher than in any major UK city in the past 12 months, according to a new report.
The research by Hometrack shows that Manchester prices rose by 8.8% year on year to February 2017, outperforming other big UK cities which had an average price growth of 6.4%.
It comes as a separate report shows that Manchester is also a hotspot for overseas investment in commercial property, highlighting the strength of the city’s economy.
According to Hometrack, homes in Manchester remain relatively affordable with an average price of £152,000, compared to the London average of almost £490,000. Liverpool, where an average price of almost £116,000, is the most affordable UK city.
In terms of price growth Manchester was followed by Portsmouth where prices rose by an average of 8.1% in the past 12 months, Bristol (8%), Glasgow (7.8%), Birmingham (7.4%), Leicester (7.2%), Liverpool (6.8%), Bournemouth (6.2%) and Southampton (6%). London dropped to tenth place with 5.6% growth, tying with Sheffield and Nottingham.
Meanwhile research by real estate advisers Savills shows that overseas buyers invested £489m in Manchester’s office market in 2016 and accounted for 72% of all office acquisitions in the city. Germans were the most active, followed by US investors. Lettings reached 1.3m sq ft, with almost 70% of signings coming in the wake of the Brexit vote indicating the city’s resilience.
According to figures from Oxford Economics, Manchester’s economy grew by 2.9% during 2016 – well above the UK average of 1.8%. Office-based employment in Manchester is expected to grow by 6% in the next five years, faster than in Greater London and all other key UK regional cities and significantly above the UK average of 3.5%.
Matt Lavin of Benoit Properties International says: “Manchester’s growing international profile, together with the UK’s legal system and landlord friendly approach, make it an attractive location for both residential and commercial property investors from overseas.
“With significantly lower property costs than the capital, a steady supply of skilled graduates from its two internationally renowned universities, and a vibrant cultural and social scene, Manchester offers a real alternative to London for office-based employers. The resulting growth in employment and enhanced career opportunities mean that the city is attracting or retaining more graduates and young professionals, which in turn is driving demand for housing and pushing up prices.
“While Brexit has created some uncertainty in the UK market, Manchester has proved resilient and demand is likely to remain strong in the coming years. Meanwhile the devaluation of Sterling makes pricing even more attractive for overseas investors.”
