Manchester House Prices to Grow by 30 Percent
Property investors are no stranger to the Manchester buy to let market, and a recent article by This is Money detailed how prices are set to rise by 30% within the next four years.
Manchester’s surge in the cost of property demonstrates one of the biggest value leaps in Britain, helping to close the gap between London and other UK cities. Its property market is considered the third most valuable in England.
The average house price in Manchester is £158,000, with the year-on-year increase in January 2018 recorded at 6.70%. To put it in perspective, there has been a 34% price growth in Manchester property since 2009.
These positive rates are reflected in the buy to let sector, which is great news for property investors. Buying property now means that there is excellent potential to cash in on the 30% price increase if deciding to sell in future years.
This much-loved term by investors which is also known as capital growth refers to a rise in the value or price of assets. In the buy to let industry, the asset in question is property. When the end market value of a property exceeds the original purchase price, the difference indicates the profit or capital made on the investment.
Why are Prices Rising?
Firstly, the major influence on the cost of property in Manchester stems from the demand for residential and student housing across the city. Manchester’s population has peaked in 2018 at 2,713,000 people. This is an 84% growth rate since the last recorded figures in 2015. An influx of young people from overseas and throughout the UK has contributed to this huge surge in inhabitants who are on the hunt for high-quality places to live.
Leading on from this, Manchester’s housing supply simply does not meet the demand that is constantly increasing. This is what is causing property prices to soar, as the accommodation available to tenants is so limited. Lack of stock has created urgency within the marketplace, encouraging investors to get their hands on rare opportunities whilst they can which will reap the benefits of capital appreciation in years
The quality of properties in Manchester is also a contributing factor. Tenants of 2018 are looking for a specific kind of living space with certain amenities on site. This narrows the market even further, with developments that receive modern makeovers proving more popular with young residents. Prices are thus being driven up in the highly sought-after buy to let locations.
Regeneration in Manchester is another big factor to take into account when analysing the recent house price growth. An 800 million mixed-use redevelopment called NOMA is transforming 20 acres of Manchester land into a residential, commercial and leisure hotspot. Various other renovations in the city centre such as Spinningfields and amongst suburbs like Ancoats and New Islington are establishing Manchester as a more desirable place to live. Properties increase as their adjacent environments blossom under innovative regeneration schemes.
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