Here, we discuss how positive figures pertaining to Manchester’s growth and economy are creating a positive landscape for those who want to live and work in the city – and, crucially, those looking to invest in it.
A region to rival London
For decades, the capital has been the UK’s most powerful magnet for property investors. Now, however, attention is increasingly turning to up-and-coming developments elsewhere in the country.
Manchester in particular is being hailed as a new Mecca for great value investment opportunities, but what is it about this Northern gem that’s igniting such excitement amongst today’s investors?
Manchester’s increasing appeal
According to the 2011 UK census, Manchester is the fastest-growing city in the UK. In the ten years prior to the census, the city experienced a 19% population increase and housed over half a million inhabitants; as of 2013, this figure grew further to 514,400, with nearly 25,000 people living in the city centre itself. Incredibly, forecasters are expecting 128,000 more residents to be living in the area by the year 2025.
Focusing on growth to meet rising demand
With more people comes a greater demand for work, and the local authorities are keen to generate high employment growth by expanding Manchester’s commercial sector. By 2024, Greater Manchester is expected to offer over 110,000 more jobs to its residents, particularly in the professional services, digital and cultural sectors; at this point, it is predicted that the region’s economy will be worth more than £70 billion a year.
As we’ve previously reported, the city is becoming a hub for creative agencies and entrepreneurs, partly due to ongoing investment in X1 Media City (you can learn more about what this development is doing for Manchester here). The city’s post-graduate retention strategy is complementing this investment by ensuring that Manchester holds onto many of its brightest graduates by creating opportunities that match the skillsets of those that are leaving its leading colleges and universities, in turn increasing the number of young professionals who are keen to remain in the area.
Nurturing culture and improving connections
Property and business aside, Manchester boasts a distinctive cultural identity. The city is packed with bars, restaurants, theatres and sporting venues, and hosts a world-class programme of events all year round. The entire region is also becoming more easily accessible by road, air and other means of public transport and will benefit hugely from the High Speed 2 and TransRail projects, which will greatly improve commuting times to and from London. Manchester Airport is now officially the UK’s third-busiest airport, too, connecting the North of England to over 160 worldwide destinations.
A lack of residential units
There’s no denying, then, that Manchester is a great place to live, but structural inadequacies have led to a gross undersupply of housing. Construction in the city is rising as a result, and new schemes are set to deliver approximately 1,426 new units by the first quarter of 2016, but this is not even a fifth of the units that Manchester Council estimates will be needed to satisfy demand. It’s going to take a number of years for Manchester’s property market to meet the requirements of its population, so in the meantime, house prices will continue to rise, creating attractive conditions for investors.
Despite the fact that the market is performing well and prices are expected to grow by more than 26% by 2019, property in Manchester still remains very affordable in comparison to many other locations in the UK. The average house price in the city centre as of December 2014 is £211,571, less than half of the price of a similar property in London, which sits at around £450,125. Add soaring rents into the mix (tenants are currently paying up to £900 a month for a one-bed apartment in the centre) and it becomes clear that investors can expect to generate healthy yields.
The forecasted growth in Manchester is igniting confidence amongst workers, employers and, crucially, those who are looking to invest in the city. Seeing the local economy go from strength to strength post-recession is encouraging aggressive development and turning Manchester into a prime location for domestic and international investors. Surrenden Invest is committed to sourcing high-potential off-plan developments in Manchester; for more information on our current opportunities, please contact one of our consultants.
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