Smart Property Investors Set Their Sights on Manchester
Across the UK the buy-to-let sector is flourishing, but a combination of affordable living costs, excellent domestic and international transport links and opportunities for education and employment are attracting residents to Manchester to make it a smart and profitable choice for property investors.
The broad demographic of the city’s commercial and residential inhabitants means that there’s a large pool of tenants with varied budgets currently looking for accommodation or premises and investors looking for high yields should be building a portfolio now to capitalise on demand.
The 2012 census report showed that in the last decade, Manchester has been the “the fastest growing of all core cities in England,” creating demand for property that far outweighs supply and is driving prices up.
In the last year, house prices have risen by 5.8% but most growth has taken place in the rental market.
Research conducted by TotallyMoney.com showed that while property yields in the South were ‘returning well below the national average,’ of 4.2%, Manchester ranked 4th nationally and 1st in the Northern regions for providing investors with an impressive 8.71% average yield on their outlay.
However it’s not just the residential sector where demand is creating lucrative opportunities for investors, the commercial sector is also offering great returns.
Real estate advisory service, CBRE, released their, “The UK is Building” report which identifies Manchester as “one of the most active regional city centre markets” in the UK and due to high occupier demand, “the ever-decreasing supply of available prime Grade A stock has given landlords a slight upper hand.”
Although the limited availability of modern commercial premises is driving up net effective rents across almost all regional centres, most can command rent of around £22-£25 per sq ft, but Manchester is bucking that trend to achieve the UK’s second highest rental yield of £30-£35 per sq ft.
To meet and capitalise on demand, city planners have a number of large-scale developments in the pipeline that are designed to support the region’s infrastructure and attract international investors and visitors to the city to sustain its socioeconomic growth.
For some time, the city has been proactively targeting the Chinese market and as a result, has enjoyed a 31% rise in tourism in the last year.
Tax-free shopping company, Global Blue, report that:
Chinese visitors spend more in Manchester’s stores than any other nationality, with an average transaction spend of £677.
Inevitably, this increase in tourism has brought with it an increase in Chinese investment.
As David Percival MBE, Managing Director of the China International Business Development Group at Deloitte explains,
BCEG, Ginkgo Tree, Top Spring International Holdings, [and] CQME to name but a few are reaping the merits of investing in Greater Manchester.
If you, like them, want to enjoy some of the highest property investment yields available in the UK, then now is the perfect time to be building a property portfolio in Manchester that can take advantage of existing and future demand.
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