The city is “severely starved of supply”, with UK and international investors being attracted by Manchester’s “favourable capital and rental growth”.
- Property prices in Manchester will rise 15% faster by 2021 than the UK average
- Investors will also see rental growth of 20.5% over the next four years, as a new report declares Manchester as the “unofficial capital of (the UK’s) purpose-built rental sector”
- Severe undersupply is driving returns for investors, making Manchester “the market to watch in 2017” for property investors
Property prices in Manchester are expected to grow 15% faster in Manchester than the UK average over the next five years, as a new report also names the city as the “unofficial capital of the purpose-built rental sector” in Britain.
Manchester is home to “one of the hottest residential markets in the UK”, according to JLL’s February 2017 Northern England Residential Forecasts report. Pointing to rapid population and economic growth, along with one of the lowest housing supplies in the country, the real estate firm forecasts that Manchester “will once again be the market to watch in 2017”.
The report outlines:
- Property prices in Manchester rose by 30.8% between 2014 and 2016
- Average prices are set to increase by a further 28.2% between 2017 and 2021, 15.1% faster than average UK prices collectively
- Manchester’s average rents have also risen by 25.4% over the last three years
- JLL has forecast that they will grow by a further 20.5% over the next four years, 2.9% faster than the UK average
This performance is being driven by a significant undersupply of available property. Household numbers in Manchester are forecast to increase by 3,300 a year, and 42,000 in total across northern England. But recent construction levels indicate that just 32,000 are currently being built across the region each year.
“Manchester city centre is severely starved of supply which in turn is pushing price growth,” said Louise Emmott from JLL Residential, Manchester.
“We have seen increased levels of international investor interest over the course of 2016 and expect this to continue during 2017 and onwards. Both UK and international investors are increasingly turning their attention away from the traditional hotspot of London towards Manchester, buoyed by more favourable capital and rental growth.”
JLL also declared Manchester as “the unofficial capital of the purpose-built private rented sector”, suggesting that the city is driving the build-to-rent revolution in the country’s rental market more than any other.