Investment insight – what does Manchester offer?…

Growing population

One of the factors driving house price growth in Manchester is the increasing population and resulting increased demand for housing. Manchester’s population increased by about 60,000 (from 2,710,000 to 2,770,000) between 2018 and 2022.

Residential construction is not developing at the same pace, mainly due to the delays caused by the pandemic.

High demand for student housing

There is a large student population in Manchester, due to its proximity to several top universities, which is increasing every year. Not only does this growth impact housing demand while students are in college, but many graduates also choose to settle in the city or area where they studied.

Manchester can provide students with most of the amenities available in places like London. The renovation projects in the city have improved facilities such as music venues, bars and restaurants, sports stadiums and many other amenities that graduates like to use. The vibrant nightlife makes it an attractive location for a social life during university, but also after university.

Manchester was recently ranked as the second best city for nightlife in the UK, after another northern city, Newcastle. Manchester is home to several popular music venues that host live events and there are many different areas of the city center to socialize.

‘Race for space’

Another factor influencing housing demand and driving up prices in Manchester is the ‘race for space’ that has arisen as a result of the Covid-19 pandemic. The term ‘race for space’ refers to the increase in the number of people looking for new homes that offer them more space, both inside and out.

The experience of sitting at home for extended periods during lockdowns made many people think about the amount of space they have and how they would benefit from a bigger home. Working from home and the need for a home office is also a new priority that requires more space.

In places like London, people pay a lot more rent for space compared to the same amount of space in most places in the north of England. That’s why many people and businesses are now moving away from London and other southern locations to get more value for money elsewhere. According to Statista, central London had an average monthly rent per square meter of £26.07 in 2020, while Manchester’s average rent was £11.12. London was the second most expensive city in Europe, with only Paris having a higher monthly rent.

Lower real estate prices

Despite areas such as the North West seeing such a surge in house prices, homes still cost significantly less on average than buying in London. The average house price in the capital was just over £675,000 at the end of 2021, while the average house price in the North West was £233,000.

This makes it easy to see why so many real estate investors are rushing to invest in these booming areas of the north.

How rental growth is affected

Due to all the reasons discussed above that create an imbalance in the supply and demand of housing, rental growth in the North is expected to accelerate at a rapid pace in the coming years. The huge difference between the average rent per m2 in London and Manchester is expected to narrow as the demand for property in the northern city grows.

Rents are expected to rise 4.5% in the UK by the end of 2022, but Manchester is expected to perform significantly better than average, with rental growth expected to grow at 16.5% over the next five years.

At present Advantage Investment can offer a variety of excellent investments in Manchester city centre, priced at 15% below market value, with panoramic views over the city and only a short distance from Deansgate, Victoria Station and the main shopping area. Email [email protected] to request Manchester property brochures and find out more.

*Advantage Investment specializes in finding the best real estate investments for its clients.

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