Out of all the 25 cities studied, Manchester came in at second place with an overall score of 72 points. This was only two points behind the highest-rated city, Oxford. The analysis looked at five key indicators that impact the desirability of buy to let locations.
This included the average total rent, the best short-term returns through yields and finally, long-term return through house price growth over the past decade. They also looked at average void periods in each city and the percentage of the city’s population that are in the private rented sector.
The appeal of Manchester for buy to let investors should come as no surprise - the city has seen a huge amount of regeneration and investment, which has given the city a new lease of life. The city region has attracted numerous large corporations and it has made a name for itself in the digital and tech sector - which contributes around £4.1bn to Manchester’s regional economy. This has resulted in an influx of people moving to Manchester, looking to take advantage of the wealth of opportunities. According to the most recent ‘State of the City’ report by Manchester City Council, the city centre has seen a huge population growth - there are currently around 65,000 people living in Central Manchester and Manchester City Council believes that this figure will increase by 100,000 by 2025.
This vast population growth has put a huge amount of pressure on the city’s housing supply. According to Zoopla, house prices in Manchester have increased by 40.9% in the past 10 years and average rents currently stand at a staggering £1,348 per calendar month. These figures are only set to grow further as the demand for rental properties in Manchester intensifies.
Damian Thompson, Director of Mortgages, Aldermore said of the analysis: “Aldermore’s Buy to Let City Tracker shows there are still great short and long-term investment opportunities for landlords. The number of people renting in the UK has been rapidly growing, up 1.7 million in ten years, so private landlords are an increasingly central part of the housing market as supporting a robust and strong Private Rented Sector becomes more essential.
The UK housing market has never been a singular thing, instead made up of multiple smaller markets with their own unique conditions and challenges. There have been numerous regulatory changes recently and persistent economic uncertainty, but this affects every region differently. Going forward, landlords will need continual backing and advice from lenders and the wider industry so they can provide choice, diversity of tenure and quality properties for renters.”
Manchester has achieved a lot in recent years and what’s more exciting is that there is still a lot of potential to grow even further, making now the ideal time to invest in Manchester.
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