Manchester is benefitting from the recent £1bn investment as part of the Government’s Northern Powerhouse initiative. It is showing itself to be a vibrant, forward-thinking metropolis with the most attractive city centre investment market in Britain, according to JLL.
The property specialist company rates Manchester as its No. 1 prospect for residential price growth over the next five years, with annual average growth of 4.2pc compared with 2.4pc across the UK. Rents are expected to increase by around 3.5pc per annum between now and 2020.
House prices grew by 10pc in 2017, with the average two-bedroom flat now costing £250,000 (an increase of 8.7% over 2017), and rental prices rose by 3%, according to JLL’s latest research.
Pivotal to Manchester’s success is a revival in demand for city-centre living – a trend that was at its height before the 2008 recession, which collapsed along with house prices due to sheer oversupply.
In 2000 there were 10,000 people living in the heart of the city. Now there are nearly 70,000, many of them students or young professionals with a desire to live close to where they work and play.
“City living has gained strong momentum in Manchester over the past three years and, together with an active student market, has pushed demand in both the sales and lettings markets noticeably higher,” says Neil Chegwidden, of JLL residential research.
“And with housing supply in the city centre severely constrained, prices and rents have soared.”
For investors with an eye on Manchester, its student population of more than 85,000, spread among four universities, plays a crucial role.
The city has the highest retention rate of students after London, with 50% choosing to stay after they graduate. Six in 10 Manchester-born students who go to university elsewhere also return to their home town after graduation.
Nick Whitten, JLL’s director of UK research, says: “You can see the reasons. They already know they enjoy living there and there are plentiful employment opportunities and affordable housing.
“More new businesses are coming to the city than anywhere else in the UK, outside London. Many of them are first-time investors in the city, which reflects Manchester’s growing profile.”
Photo Credit: PeterMcDermott