Manchester has firmly established itself as one of the UK’s most promising cities for property investment. With its strong economic growth, extensive regeneration projects, and vibrant cultural scene, Manchester is becoming the go-to city for investors looking for high returns. As we enter the final months of 2024, the city’s property market is more dynamic than ever, offering a wealth of opportunities for property investors.
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Here’s why Manchester stands out as a prime location for property investment this year…
Thriving Economy and Job Growth
Manchester boasts one of the fastest-growing economies in the UK. The city is home to numerous corporate headquarters and start-ups, attracting both local and international talent. This economic expansion is driving a strong demand for both residential and commercial properties, providing a solid foundation for property investment.
Manchester is home to the largest regional financial, professional, and business services (FPBS) industry outside of London employing over 280,000 people. Many businesses have recognised the benefits of Manchester and have moved their offices and headquarters there. Some of the global and UK leaders in FPBS such as Barclays, AXA, HSBC, and Goldman Sachs have re-located.
Manchester also has thriving technology and innovation services, with almost 2,000 high-growth companies and 510 tech company headquarters. Media City is an enormous employer in Manchester, with over 7,000 people working there, and is in an area surrounded by regeneration. Whilst Manchester already has a booming economic hub, statistics show it is set for further growth.
EY’s regional economic forecast predicted that Manchester would lead in job creation, creating over 25,000 new jobs over the next 3 years. Additionally, EY reports that Manchester’s economic output will grow faster than the Capital by 2027.
Not only is Manchester a thriving city, but the surrounding areas making up Greater Manchester, such as Bolton, Bury and Stockport, are also places of interest for investors. Greater Manchester holds a GVA of £78.7 Billion and is the largest city region economy outside of London. Its economy has grown by 39% from 2010 to 2020 and as we approach the halfway point of this decade, there are no signs of economic growth slowing.
Affordable Property Prices Compared to London
While property prices in the capital remain prohibitively high, Manchester offers more affordable options for investors without compromising on rental returns. The average property price in Manchester is considerably lower than in London, yet the city still delivers impressive rental yields, often in the range of 5-7%.
This affordability factor is a key reason why many investors, both domestic and international, are choosing to invest in Manchester over other UK cities. With demand consistently outstripping supply, especially in the city centre and key suburbs, property values are set to rise steadily over the coming years.
Furthermore, property prices in Manchester are growing whilst London’s are falling, making Manchester a more attractive investment for capital growth. The most recent UK Cities House Price Index shows London’s house prices have dropped by 0.5% compared to Manchester’s continued 4.5% growth over the last year. Savills 5-year forecast also predicts growth in Manchester of 28.8% which is higher than the UK’s national average of 21.6%.
Extensive Regeneration Projects
Manchester’s skyline is constantly evolving, thanks to billions of pounds being invested into regeneration projects across the city. The regeneration of many neighbourhoods has already led to significant increases in property prices and rental demand. Investors who tap into areas undergoing regeneration can benefit from long-term capital growth, as well as heightened rental demand from residents eager to live in revitalised, modern parts of the city.
Here are some of the top spots in Manchester for regeneration:
1. Victoria North
- This is going to be the biggest regeneration project in Manchester. Over the next two decades, 15,000 new homes will be created and the creation of 7 new neighbourhoods. This will make use of primary brownfield sites and will see an added 40,000 people integrated into Manchester’s already vibrant environment. The project will also see public transport links and public greenspaces improved.
2. Ancoats Mobility Hub
- Construction began on this game-changing regeneration project in June 2023 and is set to be complete by the end of this year. It will hold 15,000 sqft of public realm, 406 car parking spaces, a café and a store. This project hopes to make Ancoats a ‘people first’ neighbourhood and increase greenspaces, footpaths and cycle lanes.
3. NOMA
- There is a 20-acre masterplan to create new homes, offices, hotels, shops and restaurants. NOMA is another key large-scale project, similar to the likes of MediaCityUK, Spinningfields and Manchester Waters, which have all had massive successes in revitalising Manchester into the Northern Powerhouse it is now.NOMA will cost over £800 million and is set to be complete in 2029. Despite this, it has already brought over 5,000 jobs to the area and has seen Amazon’s first HQ outside of London.
World-Class Transport Links
Manchester’s transport infrastructure is another key factor that makes it a hotspot for property investment. The city’s well-connected rail, road, and air links provide easy access to major UK cities and international destinations.
Manchester is home to two large train stations in Manchester Piccadilly and Manchester Victoria. Travelling to nearby cities in Liverpool, Leeds, and Sheffield is seamless and is accessible in less than an hour. Travelling from Manchester to London can also be accomplished in just 2 and a half hours.
Manchester also has excellent tram and bus links that connect the entire city and the surrounding areas. Manchester airport is also just a 15-minute tram ride away, making it easy to reach a range of European and International destinations.
A Booming Student Population
Home to several world-renowned universities, including the University of Manchester and Manchester Metropolitan University, the city attracts a large student population each year. This creates a high demand for student accommodation, especially in areas like Fallowfield, Rusholme, and the city centre.
In the academic year of 2022-23, there were almost 124,000 university students in Greater Manchester. Not only does this create strong rental demand, but it also creates a vibrant, diverse city. Furthermore, 51% of students in Manchester stayed in the city after graduating, and 57% of students from Manchester who left for university, returned after graduating. This is second in the UK, only to London. This means Manchester has a huge population of young professionals with the median age being 31 years old, which is lower than the national average of 40 years. The largest age band in Manchester is 20–24 years old, while the lowest age band is 90 and over. A young population brings large companies to set up offices in Manchester, boosting growth.
Cultural and Lifestyle Appeal
Manchester’s cultural scene is another draw for both residents and investors. Known for its vibrant nightlife, music, arts, and sports, the city offers an attractive lifestyle for young professionals, students, and families alike. The city is home to two Premier League football clubs, iconic music venues, a thriving food scene, and a wealth of galleries, theatres, and festivals.
This cultural appeal makes Manchester a desirable place to live, driving demand for rental properties. As more people seek to live in the city, particularly in fashionable neighbourhoods like the Northern Quarter and Deansgate, property investors are well-positioned to capitalise on this growing demand.
A strong cultural appeal to the city also means a high level of tourism. There are 1.15 million international visitors to Greater Manchester every year, making Manchester the UK’s third busiest City.
Strong Rental Demand and Yields
Manchester consistently ranks as one of the top cities in the UK for rental demand, thanks to its booming economy, expanding population, and vibrant lifestyle. Whether it’s young professionals looking for apartments in the city centre or families seeking homes in the suburbs, rental demand is high across Manchester.
With an average rental yield of 5-7% in many parts of the city, property investors can expect strong returns, particularly in high-demand areas like Ancoats, Salford, and MediaCityUK. This makes Manchester one of the most attractive cities in the UK for buy-to-let investment in 2024.
Conclusion
Manchester is an ideal destination for property investors in 2024, thanks to its growing economy, affordable property prices, extensive regeneration projects, and strong rental yields. Whether you’re a first-time investor or looking to expand your portfolio, the city offers a wide range of opportunities that promise both short-term gains and long-term capital appreciation.
As Manchester continues to evolve, its property market will only become more lucrative, making now the perfect time to invest in this Northern powerhouse.
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