Thanks to low property prices and high rental values, Manchester’s property market is quickly becoming the perfect place for property investors to spend their cash in 2023
In January 2022, average Manchester property prices were valued at just £211,773 by the Land Registry. This is over £55,000 cheaper than the UK average and is more affordable than places like Leeds, London, and Edinburgh.
The most recent Land Registry data from February 2023 shows an average Manchester house price of £231,110, which is still below the average in many UK cities, while showing a growth of 9.13%.
This affordability is emphasised when you compare central city-centre locations.
The average Manchester city centre property can be purchased for around £279,028 as of March 2023, according to Zoopla data on recent listings in the area.
For comparison, Central London house prices are around 591% higher than property to let in Manchester.
In context, that means you could buy nearly six Manchester city centre properties for the price of just one in Central London. Investing in Manchester is incredibly affordable considering the popularity, size and growth of the city.
Significantly for property investors targeting long-term house price growth, average property prices in Manchester are soaring at an incredible speed.
In the last five years, the average Manchester property has increased by a whopping 36.31%, with a 20-year growth rate recorded of almost 390% – the highest out of every major UK city.
Savills expects that Manchester, along with the rest of the North-West, will see a further growth of 11.7% by 2027, so Manchester property investment will benefit more than other cities it could compare to.
These growth levels mean there’s a considerable opportunity for capital appreciation in Manchester, giving even more reason to invest in Manchester buy-to-let.
This suggests a lot of promise for 2023 and beyond with property prices after Brexit in Manchester.
Manchester Rental Market Data
Alongside the booming Manchester property market, Manchester’s rental sector is also seeing huge growth.
According to Home.co.uk data from April 2023, the average rental income per month in Manchester lies at around £1,498.
This is £314 higher than the UK average, despite average UK property prices being 24.61% more expensive than in Manchester property investment.
Due to massive rental returns and low prices, investment properties in Manchester can generate average gross rental yields of 7.78% – higher than the average rental yield in Birmingham, Leeds, London, and Newcastle!
These statistics are only going to get better, too. A recent report from JLL has predicted a rental price growth in Manchester of 3% in 2023 – higher than the UK average (2.5%). As well as this, there’s a predicted 5-year growth of 21.6%, a huge rise.
As such, there’s likely never been a better time to invest in Manchester buy-to-let property.
Manchester Rental Market Undersupply
A big reason behind the massive growth seen in Manchester’s property market is down to a huge undersupply of properties in the city.
Across the UK, tenant demand has hit a record high, with a 2022 report from Rightmove finding that the number of buyers enquiring about UK homes is 15% higher than at the same time last year.
This demand is even higher in Manchester. A study from Zoopla in 2020 found that the ratio between supply and demand in Manchester is around 1:5. This means for every single property, five people want a home.
Manchester Evening News also reported that rental demand in Greater Manchester rose by 20% annually from 2021 to 2022, showing that there is continued rental demand in the area.
These figures continued into 2021, with Manchester rental market demand so high that property supply reached its lowest-ever level, according to Urbanbubble.
It’s not surprising that this is the case when you look at how much the Manchester population has grown over the last two decades.
According to the Manchester Evening News, the Greater Manchester population increased by 7.7% between 2006 and 2016 – double that of the UK average.
This growth was higher in the city of Manchester, with the population now 27.8% higher than 30 years ago.
More people than ever need a home in Manchester, which is good news for buyers looking at tenanted property for sale near Manchester. Not only can you expect consistent rental demand, but long-term capital growth is also huge.