Student Property Investment Manchester: 5 Reasons to Invest in 2021/2022

Why Invest in Student Property Manchester? (5 Reasons) 

For any property investor, Manchester has proved to be an exceptional choice for the last two decades. 

But while the residential buy to let Manchester market has exploded (read our Manchester property investment guide to learn more), the same can be said for its student market. 

With one of the largest student populations in all of Europe, world-class universities, and affordable housing, student investment property in Manchester sits on top as the favoured investment destination for investors. 

It’s no surprise then that Manchester is regularly considered one of the best places to invest in student property.

There are currently five central reasons why people are choosing to invest in student property in Manchester. 

They are: 

1. Manchester Property is Affordable With Huge Returns Available 
2. A Massive International Student Population 
3. Three World-Class Universities  
4. Fantastic Employment Opportunities  
5. Excellent Nightlife and Affordable Lifestyle 

Let’s discuss each in detail below. 

1. Manchester Property is Affordable With Huge Returns Available 

As a property investment location, Manchester is in a league of its own. 

Offering some of the most affordable property prices and highest return potential out of every major UK city, student property investment in Manchester offers a compelling solution for investors. 

According to the latest Land Registry data, the average Manchester property is valued at just £207,625. 

This is just under £50k below the UK average, and is more affordable than the likes of Leeds, London, Edinburgh, and Brighton. 

Crucially for investors, these low property prices lead well to huge return potential. 

Using the latest Zoopla rental data, the average gross rental yield in Manchester (without factoring in expenses) is a huge 6.61%. 

For comparison, the UK average is 4.94%. 

On top of these rental returns, Manchester sits alone for capital growth. 

In the last 12 months, Manchester property has increased in value by a staggering 13.65%. 

Looking back further still, Manchester prices have increased by 331.94% over the last two decades, according to official Land Registry data – the largest capital growth out of every major UK city. 

These returns are incredibly exciting for investors, especially when you factor in future growth. 

According to the latest Savills house price predictions, the North West region of England is set to see property prices rise by 28.0% by 2025 – the joint-highest growth rate in the UK. 

Factoring this growth with the potential to find student investment property in Manchester for below the £100k mark, while also enjoying NET rental yields commonly found upwards of 7%, the city is undoubtedly a smart choice for investors. 

If you’re wondering why student property investment in Manchester is popular, these sky-high returns are why. 

2. A Massive International Student Population 

Naturally, investors interested in student property will need to keep a close eye on the student population of a city. 

After all, the higher the student population, the more demand for student property in the region. 

Luckily for investors, Manchester’s student population is one of the largest in all of Europe. 

With over 100,000 students in the Manchester region, student investment property in Manchester regularly proves hugely popular. 

A report from Zoopla in 2020 found that demand for property in Manchester outweighs supply by 5:1. 

This is also seen in the student market, with a Savills report finding that in the UK, full-time students outweigh available beds by 3:1. 

These numbers are incredibly beneficial for student property investors in Manchester, as it almost ensures that demand will be huge for a purchased student investment property in Manchester. 

What’s truly significant about these high numbers is that there is a huge number of international students. 

In late 2020, over 7,000 Chinese students flew into Manchester to study, while the overall reported number of international students in Manchester universities is around 20,000. 

The fact a large number of students in Manchester are Chinese is important, as studies show Chinese students are far more likely to rent purpose-built student accommodation – 2.2 times more likely according to Savills. 

This international reputation as a student city has been carefully cultivated by Manchester. 

The city is the third most visited city by international tourists in the UK, and is one of the most linguistically diverse locations in all of Europe with over 200 languages spoken, according to Study in Manchester. 

Factoring in this huge population and their preference of PBSA, which is the most popular and highest returning type of student property in 2021, student investment property in Manchester is a clear choice for prospective investors. 

3. Three World-Class Universities 

The central reason behind Manchester’s huge international and domestic reputation as a world-class student city is thanks to its three top-quality universities. 

With The University of Manchester, Manchester Metropolitan University, and The University of Salford to choose from, along with 20 universities within one hours drive, Manchester students are spoiled for choice. 

Perhaps the most noteworthy is the University of Manchester, which is likely the biggest pull for students. 

Here, the University of Manchester was voted in the top 30 universities in the world in 2021 – its highest-ever position! 

The quality of Manchester universities is exceptional, with studies finding that 94% of graduates from the University of Manchester and Manchester Metropolitan University go into employment or further education within just six months. 

However, while the University of Manchester gets the headlines, Manchester’s other universities are quickly becoming some of the most popular in the UK. 

Manchester Metropolitan is hugely popular for vocational courses like business and art and hosts the highest number of undergraduate applications in the UK.  

Likewise, The University of Salford is becoming a fantastic option for investors, with strong links to the nearby £1bn MediaCityUK to give students world-class employment opportunities. 

Overall, student property investment in Manchester is heavily boosted by Manchester’s undeniably exceptional education sector. 

4. Fantastic Employment Opportunities 

Manchester has the second largest graduate retention rate in the UK, with averages of over 50%. 

Back in 2016, the city reported a graduate retention rate of 70%, meaning a staggering 70% of students stayed in the city after graduating. 

This is significant for investors, as it gives them further investment opportunities to buy a residential property in the future. 

But why are so many students and graduates choosing to stay in Manchester? 

Well, likely the biggest contributor to this is the fantastic employment opportunities in Manchester.  

In July 2020, Manchester, alongside Liverpool, was voted in the top 10 global locations for business start-ups. 

A bulk of these employment opportunities are focused on both Spinningfields and MediaCityUK. 

Noted as Manchester’s answer to Canary Wharf, Spinningfields is a booming business region in the heart of Manchester city centre. 

Around 150 world-class financial and commercial businesses call Spinningfield home, making it a huge employer of young professionals. 

While Spinningfields boosts employment in central Manchester, MediaCityUK generates huge attraction in Salford. 

MediaCityUK, which has cost over £1bn, is home to the UK’s biggest media companies like the BBC and ITV, and has attracted mega businesses such as these from London to Manchester. 

And, with billions being spent on regeneration to boost employment in the region, such as NOMA, the future of Manchester is bright, and is likely to increase the viability of student investment property in Manchester for years to come. 

5. Excellent Nightlife and Affordable Lifestyle

The final major factor behind the huge success potential of student property in Manchester is the appeal of Manchester as a place to live. 

When it comes to lifestyle, students are looking for exciting nightlife, things to see and do, and all most importantly at an affordable level. 

Excitingly, Manchester supplies all these factors and more. 

With a thriving musical scene that produced the likes of Oasis, The Stone Roses, and The Smiths, there are tonnes of fantastic musical venues dotted across the city. 

For the more cultural and art-loving students, Manchester also boasts several excellent museums and galleries including the National Football Museum and The Whitworth Art Gallery – with the majority of venues offering free entry. 

On the topic of affordability, Manchester is one of the most cost-friendly places for students. 

The annual Manchester Student Night Out delivers unique student deals at over 100 shops, with the city famed for its shopping scene with the likes of the famed Trafford Centre.  

This affordability is even better for international students, who can shop at many locations tax-free!  

Access to all these great places, including the immensely popular student hotspot The Northern Quarter, has never been easier thanks to excellent transport links. 

Whether students are travelling to university, a shop, or to a part-time job, Manchester ensures transport links are widely available with frequent buses and an excellent city-wide tram system. 

It’s no surprise that Manchester was voted the best UK city to live in according to the Global Liveability Survey. 

How to Invest in Manchester Student Investment Property 

Currently, there are two popular ways to invest in student property. 

1. You can invest in a house of multiple occupation. Or… 
2. You can buy purpose-built student accommodation 

While we won’t go into massive detail here – you can learn more about how to invest in student property in our guide – the bottom line is that PBSA is likely the best option you can make right now. 

A culture change amongst students has meant that more students are looking for premium, high-quality living spaces – something that HMOs, which are typically older properties, cannot provide. 

In the last year alone, a report from Savills found that over £5.77bn was spent on PBSA – the highest ever figure by 0.8%. 

With all current market data pointing to PBSA being the preferred choice for student property investment in Manchester, it’s likely your best bet for netting the highest profits. 

If you’re serious about investing in student accommodation in Manchester or Liverpool, RWinvest is the perfect company for you.