- Best Areas to Buy in Manchester According to Rental Yields
- What Is Rental Yield and Why Is It Important?
- What Is the Average Rental Yield in Manchester?
- M15 - Hulme, Manchester Science Park
- M12 - Ardwick, Longsight, Chorlton-on-Medlock
- M9 - Harpurhey, Blackley
- M14 - Fallowfield, Moss Side, Ladybarn, Rusholme
- M18 - Abbey Hey, Gorton
Best Areas to Buy in Manchester According to Rental Yields
Manchester has fully cemented itself as a buy-to-let hotspot with affordable property and good capital growth.
The Northern Powerhouse City has reinvented itself over the past two decades, and this surge in economic growth has enabled the population to skyrocket, causing an explosion in rental demand.
But Greater Manchester takes up a swathe of the North West, and choosing where to invest can be challenging.
Read on for more information on the latest housing market figures.
What Is Rental Yield and Why Is It Important?
A rental yield can give you an idea of the potential returns you can gain through a buy-to-let investment. This makes it a useful figure to know when looking for buy-to-let investment properties.
It is shown in percentage form and is calculated by dividing the annual rental income by the property’s value and multiplying by 100.
However, it’s important to remember that the gross rental yield doesn’t consider any other initial or ongoing costs, including taxes and expenses relating to the upkeep of the property.
What Is the Average Rental Yield in Manchester?
The average rental yields in Manchester vary greatly depending on the area.
Overall, the city has affordable property compared to other regions such as London and the South East. It also has very high rental demand and a chronic undersupply of available properties, which pushes the average renting costs higher. This combines to create the conditions for some healthy rental yields.
Taking average property prices from a recent report by Rightmove and average rental costs from housesforsaletorent.co.uk, Manchester’s average gross rental yield can be calculated as 5.55%. The figure for the whole of Greater Manchester is higher, standing at 6.41%.
Here are the postcodes with the highest rental yields in Manchester based on our research:
|Postcode||Average Property Price||Average Monthly Rent||Average Gross Rental Yield|
(Estimated rental yield calculated using average property prices from Rightmove and average rents from housesforsaletorent.co.uk)
M15 - Hulme, Manchester Science Park
- Average Property Price – £257,817
- Average Monthly Rent – £1,431
- Average Gross Rental Yield – 6.66%
This postcode includes Hulme, south of the Manchester City Centre. It has convenient proximity to the city’s university campuses, making it popular with students, as well as people who work in central Manchester.
M12 - Ardwick, Longsight, Chorlton-on-Medlock
Average Property Price – £191,766
Average Monthly Rent – £1,347
Average Gross Rental Yield – 8.43%
This postcode covers an area on the edge of the city centre, offering easy access to central Manchester. Good value properties can be found here, and the affordable prices in this district have contributed to the above-average rental yield. Learn more about real estate investing with the RWinvest property guide.
M9 - Harpurhey, Blackley
- Average Property Price – £181,090
- Average Monthly Rent – £1,282
- Average Gross Rental Yield – 8.50%
The area of Harpurhey is known as one of the best places in Manchester to find below-market-value properties, but it is also one of the most deprived areas in the country and may not be that attractive to potential tenants.
M14 - Fallowfield, Moss Side, Ladybarn, Rusholme
Average Property Price – £216,092
Average Monthly Rent – £1,647
Average Gross Rental Yield – 9.15%
This postcode includes Fallowfield, a popular area for student buy-to-lets. Student investment opportunities can often be more profitable than residential properties, which could explain this area’s exceptionally high average rental yield.
M18 - Abbey Hey, Gorton
Average Property Price – £170,312
Average Monthly Rent – £1,603
Average Gross Rental Yield – 11.29%
These districts are outside the Manchester City Centre, with good rail and bus links. Gorton is an area with affordable properties that looks set to benefit from ambitious Manchester regeneration plans targeting Gorton Town Centre and more. Based on our calculations show Manchester’s M18 postcode has the highest average gross rental yield.