Buy-to-Let Property Investment in Manchester: A Lucrative Choice

Introduction

Known as the UK's second city, Manchester, a vibrant city with a rich industrial heritage, has emerged as a top choice for property investors in the UK. In this blog post, we will explore why Manchester is considered an excellent place to invest in property, the current rental yield trends in the city, the areas with the highest ROI in the UK, and the best places to buy in Manchester in 2023. Additionally, we will address the potential investment value of buying a flat in Manchester, the city's future prospects, and whether property prices are likely to drop.

Buy-to-Let Property Investment in Manchester. Is Manchester a Good Place to Invest in Property?

Manchester's property market has experienced significant growth in recent years, making it an attractive destination for property investors. Several factors contribute to Manchester's appeal:

Economic Growth: Manchester's economy is thriving, with a diverse range of industries driving job creation and attracting a skilled workforce. The city's economic growth contributes to a strong demand for rental properties, making it an ideal environment for buy-to-let investments. With many corporations choosing Manchester as their base instead of London, the city is seeing a huge influx of population and growth. House prices and rents are rising sharply and are yet to show signs of slowing.

Educational Institutions: Manchester is home to prestigious universities, including the University of Manchester and Manchester Metropolitan University. This creates a large student population seeking rental accommodations, making the city an excellent choice for investors targeting the student rental market.

Infrastructure Development: The city's ongoing infrastructure development, including transport links and regeneration projects, enhances its desirability as a place to live and invest. The city's skyline is constantly changing with seemingly new tower blocks appearing weekly! The Metrolink network is expanding to include more satellite towns of Greater Manchester which makes the city centre commutable for many more people and reduces the number of cars on the roads.

What is the Rental Yield in Manchester, UK?

Rental yield is a crucial metric for buy-to-let investors, indicating the return on investment from rental income. In Manchester, the rental yield has remained robust, attracting investors seeking consistent returns. The current rental yield in the city varies depending on the area and property type. As of 2023, the average rental yield in Manchester ranges between 5% to 7%, making it competitive compared to other major cities in the UK. Coupled with rental yield in Manchester, capital appreciation of properties has been a huge draw for many investors seeking an uplift in value of their investment.

Where is the ROI Highest in the UK?

While Manchester offers attractive rental yields, other regions in the UK also provide high returns on investment. Areas such as Liverpool, Leeds, and Sheffield have shown promising ROI for buy-to-let investors. These cities, like Manchester, benefit from strong economic growth, increasing demand for rental properties, and lower property prices compared to the expensive London market. Investing in the Northern regions of the UK has become a popular strategy for those seeking higher ROI.

Where to Buy in Manchester in 2023? Buy-to-Let Property Investment in Manchester.

As of 2023, certain areas in Manchester present excellent opportunities for buy-to-let investors. These areas are characterised by a combination of factors that make them attractive to tenants and offer the potential for capital appreciation. Some promising locations in Manchester include:

Tameside: An area that sits to the east of Manchester city centre and includes the towns of Ashton-under-Lyne, Audenshaw, Denton, Droylsden, Dukinfield, Hyde, Mossley and Stalybridge. With major hospitals, business and highly regarded schools throughout the borough of Tameside the area is extremely popular among young and growing families. House prices and rents have risen rapidly and the area has become a 'hotspot' for buy to let investors seeking impressive returns on their investment. If you are looking for buy to let property for sale in Tameside then Property Guru can help.

Oldham: Data for Oldham shows house price growth is currently sitting at 9.3%, broadly, in line with the 9.5% figure seen in Manchester but marginally above the 8.3% UK average. With Oldham University, the Metrolink and easy access to the M60 and M67 motorways, Oldham is popular among students and commuters. With the slightly lower purchase prices but similar rents to Tameside, Oldham can produce fantastic returns on investment if you know where to look. Property Guru are specialists in selling off-market investment property in Oldham, so arrange a call today to find out more.

Salford: Salford has long been a popular choice for investors, however the price of property has risen so dramatically that the rental yields have suffered. New investors to Salford bank on capital growth and are happy to take a lower rental yield. Depending on your investment strategy, Salford could be right for you. Unsure where to invest in Manchester in 2023? Property Guru offer a free consultation call to discuss your goals and budget to see where could be the right place to invest for you.

Stockport: Similarly to Salford, Stockport has been a popular buy to let investment choice for a while now. With Manchester city centre just 8 minutes' away on the train and the huge redevelopment of Stockport Town Centre, the area is going from strength to strength.

You can also view an in-depth Manchester area guide for property investment here.

Is it a Good Investment to Buy a Flat in Manchester?

Buying a flat in Manchester can be a smart investment choice, especially for those looking to enter the property market or diversify their investment portfolio. Flats are often more affordable than houses, making them an accessible entry point for first-time investors. Additionally, flats are in high demand among young professionals and students, contributing to consistent rental income. However, as with any investment, thorough research and due diligence are crucial to identify the most promising locations and properties that align with your investment goals. You should take into account the cladding status of the tower block you are looking to buy in to ensure there is a plan in place and who will be funding the cladding replacement. Some blocks are seeing increased service charges to cover increased building insurance whilst the cladding issues are addressed. Remember, as the owner of the flat you will be responsible for paying the ground rent and service charges which can eat into your profit considerably.

What is the Future of Manchester?

Manchester's future prospects appear promising, with ongoing developments and regeneration projects driving its growth. The city's strong economy and investment in infrastructure have positioned it as a major player in the Northern Powerhouse initiative, further boosting its appeal for investors. The continuous influx of young professionals, students, and key workers seeking opportunities in Manchester bodes well for the city's rental market, ensuring a steady demand for buy-to-let properties.

Will Manchester Property Prices Drop?

As with any property market, predicting future price movements is challenging. While Manchester has experienced remarkable growth in recent years, property prices can be influenced by various factors, including economic conditions, interest rates, and market demand. Some experts believe that Manchester's property prices may stabilise or experience moderate growth in the coming years. However, any significant price fluctuations will largely depend on broader economic and market trends.

Conclusion

Manchester's property market offers a lucrative landscape for buy-to-let property investment. Its strong economic growth, thriving rental demand, and strategic development projects make it an attractive destination for investors seeking consistent rental yields and potential capital appreciation.

While Manchester stands out, other cities in the UK, such as Liverpool and Leeds, also present promising ROI prospects. When choosing an investment location, it's essential to consider factors like rental yield, potential capital growth, and local demand.

As the property market evolves, investing in Manchester in 2023 holds significant potential for investors to secure stable rental income and build a diverse and profitable property portfolio.

For expert property sourcing in Manchester and the latest investment opportunities, visit Property Guru's website.