Article Summary

Introduction

The United Kingdom’s property market has long been a source of fascination for investors, both domestic and international. Among the various cities in the UK, Manchester has emerged as a shining star, drawing substantial interest from property investors. What sets Manchester apart, apart from its rich cultural heritage and vibrant lifestyle, is its house price forecasts that promise substantial growth in the coming years. Let’s delve into the details of Manchester’s five-year house price forecast compared to other UK cities and explore why it’s an irresistible prospect for investors.

Manchester’s Ascendance

Manchester’s impressive growth trajectory in the property market is underpinned by a variety of factors. Foremost among these is the city’s thriving economy. With an economy worth £62.8 billion (as of July 2022), Manchester has the UK’s 2nd largest city economy. It has firmly established itself as a major UK business hub, attracting multinational corporations and fostering a burgeoning start-up culture. The presence of major corporations, coupled with top-tier educational institutions, has made Manchester an attractive destination for professionals and students alike, fuelling demand for housing.

The Five-Year Forecast

Forecasts suggest that Manchester’s property market is poised for significant growth over the next five years. While no one can predict the future with absolute certainty, expert opinions and market trends point toward Manchester outpacing many other UK cities. According to Savills, Manchester is expected to see house price growth of approximately 24.3% by 2026. This projection significantly exceeds the average UK growth, as the joint highest regional growth in the UK, outperforming London at +8.2%, and the UK national average at +17.4%.

Source: Savills Residential Property Forecasts, July 2022

Comparative Analysis

To truly understand Manchester’s allure, it’s essential to compare these forecasts with other major UK cities:

London: Traditionally the epicentre of the UK property market, London has experienced stagnation in recent years. Forecasts indicate that the capital’s growth will be more modest, with estimates hovering around 8-9% over the next five years. While London remains a vital investment destination, Manchester’s growth potential appears more promising.

Birmingham: As another prominent city outside London, Birmingham is forecasted to enjoy growth akin to Manchester, with estimates ranging from 19-21%. Birmingham’s investment potential is indeed attractive, but Manchester’s diverse economy and educational excellence give it a slight edge.

Edinburgh: Scotland’s capital has seen remarkable growth, and forecasts predict further appreciation of approximately 20-24% in the next five years. While Edinburgh offers unique investment opportunities, Manchester’s higher growth potential could make it a more enticing option.

Why Manchester Is Attractive to Investors

Strong Rental Market: Manchester boasts a robust rental market, driven by its student population, young professionals, and a steady influx of newcomers. Investors can expect healthy rental yields, making it an ideal city for buy-to-let investments.

Diverse Economy: Manchester’s economy is diverse, with strengths in finance, tech, manufacturing, and healthcare. This economic resilience minimizes risk for investors, as it is less susceptible to industry-specific downturns.

Regeneration Projects: The city is undergoing extensive regeneration projects, which not only enhance the quality of living but also drive up property values. Areas like Salford Quays and NOMA have already seen impressive transformations.

Transport Links: Excellent transport links, including an international airport and high-speed rail connections, make Manchester accessible to both domestic and international investors.

Cultural Appeal: Manchester’s vibrant culture, world-class sports, and thriving arts scene make it an attractive location for residents and visitors alike, further boosting demand for property.

Conclusion

In conclusion, Manchester’s five-year house price forecasts make it a compelling choice for property investors. Its diverse economy, strong rental market, regeneration initiatives, and cultural vibrancy all contribute to its appeal. While London remains an essential investment destination, Manchester’s growth potential positions it as a city to watch. Investors who act decisively may find themselves on the winning side of Manchester’s property market boom in the years to come.

To find out about more of some of the most attractive new-build and regeneration projects that Manchester has to offer, click here.