Property Investment Tips for First Time Manchester Investors

Investing in property has always been seen as something which can be extremely profitable, especially at a time when those with capital have not been seeing great returns on their savings.

In the past, most people have tended to invest in property close to where they live as they see it as safer, or bank on London being the most profitable option, but in recent years it has been cities such as Manchester which have been the best places to really put your money into.

If you have never invested in Manchester property before, then now is a great time to start. It offers affordable pricing, attractive rental yields and a huge number of attractions that continue to draw people to the area. It is a growing city, and its rapid expansion and modernisation has made it an attractive prospect.

Here, landlord estate agents, Portfolio8 have put together some important points to think about for first time Manchester property investors.

Rental yields

Investors put their money into property for different reasons, but it is either because they want to benefit from the additional income a monthly rent can bring or because they want to realise what is hopefully a growth in their investment over the period of a few years. Whatever your goal is, you still need to invest with both of these factors in mind.

Rental value is extremely important as it needs to cover your costs of owning the property, such as mortgages, insurance and letting agents, whilst hopefully having a little left over too. That is why you need to invest in somewhere that will give you healthy rental yields consistently, and Manchester is just the place to do this.

The rental yields in Manchester are amongst the best in the UK and outperform London and other southern areas by quite a long way. When this is coupled with reasonable property prices, it means that there will be plenty of profit making its way into your bank account each month.

Capital appreciation

With any property, you want to sell it for more than you paid, and this is of paramount importance when it comes to property investment. The HM Land Registry shows that the average property prices across Greater Manchester have increased by as much as 40% since 2015 and it shows no signs of slowing down. In fact, it is predicted that this will still have grown by a further 18.5% by 2025, meaning there is still plenty of room for new investors to enjoy significant capital appreciation.

Student accommodation

Manchester has a massive student population thanks to institutions such as The University of Manchester, Manchester Metropolitan University, The University of Salford, and the Royal Northern College of Music. All of the estimated 100,000 students that this brings need somewhere to live during their time studying, and with a graduate retention rate of 51%, they are likely to be sticking around afterwards too.

Student accommodation can be very profitable. With such a high demand, landlords have no trouble in finding tenants, and with many purpose-built options available now, they can all be fully managed by people on site to cut down the hassle.

Young professionals

Manchester was once known for its industrial heritage, but it is now an exciting a vibrant city that is attracting a huge number of young professionals. The BBC and ITV have moved to Salford’s Media City and many huge online businesses have also started life in Manchester or made it their home in recent years. The city was named the best city in the UK by TimeOut and the third best city in the world, so it is no wonder that so many people want to live here.

Seen as an up-and-coming place to be, there is a significant demand for property from young professionals who want to be at the centre of things when starting their careers, and property investors are benefitting from this. There has been a large amount of investment into the infrastructure of the city, and many of the old industrial buildings of the past are now being converted into luxury apartments to provide fashionable homes at the centre of shopping, night life and cultural attractions.

Manchester locations

When you are investing in property in an area that you do not live in, it is a good idea to get an understanding of the locations so that you know what’s hot and what is not. The highest rental prices tend to be achieved in the City of Manchester borough, although this is also where the highest property prices can be found.

New data has recently shown dramatic growth in Manchester property prices, with a annual growth of 9.2% with so signs of slowing down.

The Northern Quarter is well known for its artistic and bohemian reputation. Its vast array of galleries, indie bars and music venues coupled with its close proximity to Piccadilly Train Station mean that there is a high demand for rental property here.

Ancoats runs parallel to the Northern Quarter and has seen many industrial buildings being converted into modern apartments. Manchester’s first Michelin starred restaurant is based here, and the average property price in Ancoats has increased by 23% in the last five years alone.

Trafford is known throughout the world as being the home of Manchester United and the Trafford Centre shopping mall. It is serviced by its own Metro line and sits close to some of the affluent Cheshire areas that are just across the border.

Salford Quays is a little further out of the city centre but has seen huge investment recently in Media City and other creative industries. It is in high demand as a trendy place to both live and work and offers properties with waterfront views and great communication links.

With Manchester’s population growing quicker than the national average, it stands to reason that there is hefty competition when looking for somewhere to live. This puts property investors in a very strong position and means that much of the property that is currently on the market can produce the much sought-after combination of good rental yields and capital appreciation that will make your investment a great one.