Focus on…… Manchester

In this weeks article we focus on Manchester and the reasons why Residential Estates considers it to be one of the best places to invest, visit & study.

Focus on Manchester

It’s no secret that Manchester has developed into a property investment hotspot over the last few years. No visitor to the city could fail to notice the forests of cranes that have grown upon its skyline as foreign investors pour money into the development of new commercial and residential premises.

The city’s buoyant economy has been part of the reason that so many have come to regard Manchester as the UK’s number one choice for property investment and relocation. Worth almost £60 billion per annum, the local economy is larger than that of either Wales or Northern Ireland. It increased by 42% in the 10 years to 2012, and between 2009 and 2014, it grew by over 15%. This represents the fastest rate of sustained economic growth anywhere outside London.

Since then, the news for investors has only got better. In July 2017, a report by the Centre for Economics and Business Research (CEBR) found that Manchester’s economic growth was outpacing even London’s. Since 2014, Greater Manchester has seen its economy expand by 7.5% – more than the 6.9% witnessed in the capital – and Manchester city itself has seen growth of 9.1%.

In tandem with this has come a rise in jobs (up 3.4% since 2010; twice the regional rate) and the fastest rising population in the UK, according to the most recent national census.

The list of superlatives goes on. Home to 2.8 million residents, Manchester is part of the largest city region outside London, and international think-tanks such as Oxford Economics have predicted that between now and 2020, job creation will expand at a faster rate than in Paris, Berlin or Tokyo. Between January and December 2017, the city is expected to add £634 million to its GVA and to create 22,258 jobs. According to CEBR, its economy as a whole is expected to rise by a further 14.8% between 2020 and 2030.

High value industries:

Much of the city’s success is due to its knowledge-driven economy. Its universities are a vital part of this, as are its many clusters of tech businesses, which are generating growth at twice the national average for other sectors. Other organisations and partnerships are playing an important role, too. For example, Manchester Science Partnerships is the UK’s largest science park operator, and the country’s leading provider of growth support to science and technology companies. Its Central Campus supports over 170 companies working in such high value sectors such as life sciences, health technology, biotech, ICT and the digital and creative industries.

In March this year, Tech Nation reported that Manchesters digital sector was worth £2.9 billion to the local economy and found that the city supported 62,653 digital industries professionals, making it the largest cluster outside London. This has important consequences for property investors, because it helps to underpin demand for high quality rentals. High value industries sustain high-earning employees and they, in turn, demand properties of appropriate quality. According to Tech Nation, the average annual salary in the digital/technology sector now stands at £50,663, compared to an all-sector average of just £35,155.

What’s more, the city also hosts one of the country’s foremost financial sectors, which accounts for more than 16% of all jobs in the area. Financial and insurance companies employ around 96,000 workers, many of them centred around Spinningfields – a recently established £1.5 billion development that many now regard as the Canary Wharf of the North.

According to the Greater Manchester Inward Investment Guide for 2017, the value of the city’s professional, technical and scientific industries rose by 46.4% between 2005 and 2015. Its financial and insurance businesses saw GVA rise by over 16%, manufacturing was up 8.5% and the information and communication industries achieved growth of more than 30%.

Affordability and population:

Given the city’s undoubted economic success, it’s no surprise that droves of young professionals are heading for Manchester. Demand for university places is exceptionally high and the student body is vast – over 100,000 graduates and undergraduates spread across five universities. Moreover, increasing numbers of graduates are now choosing to stay in Manchester – partly due to the exceptional job prospects and partly because the excessively high costs of property in the South East have priced them out of the  capital.

Recent figures from Hometrack illustrate the difference. According to its UK Cities House Price Index for September 2017, the average property price in Manchester was £156,700 whereas in London, the figure was a substantially less comfortable £493,700. Rental costs are likewise split: Rightmove’s Rental Price Tracker notes that average rents in the North West stood at £660 pcm, while in Greater London, tenants would have to pay, on average, £1,920 every month.

Standards of living are also a factor. Not only is it easier to afford to buy or rent a property in Manchester, but once settled, the city is a much more reasonably priced place to live. On average, costs of living are 42% cheaper than in London. For all these reasons and more, the traditional exodus of talent from North to South has declined in recent years and many of the country’s best and brightest are now choosing to make Manchester their home.

This influx of new blood is clearly good news for property investors. The success of the academic sector translates into a steadily rising population of students to support the lucrative student-let market, and the growth in the high-value job market means a similar rise in the number of well paid professionals who need conveniently located accommodation.

Rental returns:

The affordability of property in Manchester is also an important reason why property investors are so enthusiastic about the city. According to LendInvest’s Buy-to-Let Index Quarterly Report for September 2017, Manchester now delivers yields of over 6% – easily the highest yields in the country. What’s more, the city has seen average rents rise by 6.26% year on year, and capital values rise by 7.39%.

In short, Manchester has clearly established a position for itself as both a preeminent investment destination and an economic powerhouse in its own right. A growing economy and a steadily expanding workforce provide the ideal foundation for successful property investment, and all the latest housing market figures agree that landlords can expect outstanding financial returns.

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Residential Estates manages luxury serviced accommodation in Manchester city centre on Canal Street from £80 per night* (check rates as they change daily) and have also recently released POPWORKS, an off plan development within walking distance to Manchester’s city centre with a pre-market discount!

To find out more about investment opportunities in Manchester, please call our advisory team on 01244 343 355.

Serviced Accommodation North West

Residential Estates specialises in the provision of serviced

accommodation around the North West, specifically in the Chester, Liverpool and Manchester regions.

Our serviced accommodation provides guests with more of a home from home atmosphere, than the usual hotel accommodation. Business travellers in particular, can appreciate a comfortable environment offering maximum flexibility, privacy and independence.

Serviced accommodation located in the North West has great transport links to all the major cities, including London, thereby making it an ideal location for a base.

Space

Our North West serviced accommodation is a wonderful alterative to staying in a hotel room. With more space for cooking, dining, living, working and sleeping, our serviced accommodation is ideal for corporate and leisure bookings alike.

Cost

Hotels are notoriously expensive. Serviced accommodation on the other hand cost approximately 30% less than a hotel of an equivalent standard. Furthermore, our serviced apartments all have a fully equipped kitchen, which saves money on room service or restaurant costs. Also, our apartments all feature free Wi-Fi, unlike the majority of hotels, placing further emphasis on their practicality and making them an ideal solution for temporary accommodation, corporate relocation’s and business trips.

Flexibility and Amenities

All of our serviced accommodation is fully equipped with fine furnishings and all the necessary appliances, crockery, cutlery, linen and towels. These amenities ensure that the client benefits from maximum flexibility, whether that is eating when they want to eat or popping out at whatever time suits them.

The apartments are a true home from home and even feature a flat screen TV, DVD and telephone. Furthermore, there is free Wi-Fi broadband access as well as the usual amenities expected in fully furnished serviced accommodation. Our serviced accommodation across the North West features a dedicated parking space for those who are travelling by car.

Trusted Accommodation

We visit our apartments and monitor the standard of the serviced accommodation that we offer. Therefore our customers can be sure to stay in quality accommodation that provides security and regulation. A one page agreement makes renting our serviced accommodation easy. We always do our upmost to ensure our guests are comfortable in their new surroundings. If there are any specific needs we encourage our guests to ask.