Manchester is the UK’s most prominent economic area outside London. Since 2005, the population of Manchester city centre has increased more than 500%. By 2024, more than 80,000 people are predicted to call Manchester city centre their home – the fastest predicted growth of anywhere in the UK.
This explosive population expansion in Manchester is spurring record demand for homes. More importantly, rising property prices across the region have resulted in Manchester becoming a predominantly renter’s market.
All of which is playing directly into the hands of the city’s current and prospective landlords.
Impressive House Price Growth
Between 2017 and 2021, average house prices in Manchester are expected to grow an astonishing 28.2%. This is the highest growth of any town or city in the UK, and is expected to drive rental prices up more than 20% during the same period. Property values towards the south of the city have begun showing signs of slowing, but Manchester as a whole continues to lead the way for the entire country.
Nevertheless, the average house price in Greater Manchester remains almost completely out of reach for the city’s average earners. A typical home (according to Hometrack) now costing £168,900, which is a full eight times higher than the average salary. As a result, fewer people than ever before are realistically contemplating the prospect of owning their own home.
With property prices expected to continue rising indefinitely, this trend is likely to continue for some time.
Rental Demand in Manchester
According to a Manchester Evening News report published in late 2018, Manchester’s Property Rental market is booming. Demand for quality properties among current and prospective tenants is having a direct impact on average monthly rents across the entire region.
Specifically, the report stated that within the past four years alone, average rental costs in Manchester have spiked by as much as 30%. Alongside Trafford, Manchester remains the region’s most expensive borough for renting a property – the average monthly rent currently standing at £775. This represents an increase of around 7% from just a couple of years ago.
Away from the city centre, impressive growth has also been recorded in Stockport (13%), Bolton (17%), Salford (18%) and Bury (20%). Double-digit growth in rent rates have become the norm across much of Greater Manchester in general.
Again, it’s worth remembering that the most recent house price growth forecast published by JLL sees total growth of 28.2% between 2017 and 2021. All of which looks set to drive average rents through the roof and continue a truly golden era for Manchester landlords.
An Enticing Investment Prospect
With the UK government continuously tightening its stronghold on landlords and buy-to-let investors, it’s easy to understand the appeal of dynamic markets like Manchester. Along with excellent growth forecasts for the coming years, Manchester is considered one of the most vibrant cities and enjoyable places to live in the UK.
The city boasts one of the most advanced digital and technology sectors in Europe, attracting start-up entrepreneurs and established businesses from all over the world. Manchester is also home to four top-rated universities and approximately 99,000 students – 350,000 students being positioned within an hour’s drive of the city centre. Another factor that keeps demand for rental properties high throughout the year.
To call Manchester a ‘city on the rise’ would be to do it a disservice – it’s already right at the top of the table for the savvy investor.