Arthur takes a look at the potential for the property market in Manchester in light of other economic improvements for the Northern Powerhouse.
Recent government findings reveal that last year nearly 70,000 people in their 30s moved out of London. Extortionately high rents and increasing property prices have left many young professionals priced out of the capital’s property market and looking for new alternatives. Manchester’s up and coming property market, the strongest in the UK outside London, is proof that the city is becoming a more attractive place to live.
More employment prospects = higher rental yields
Over the past 10 years, employment prospects have significantly improved in Manchester. Young and well-established businesses alike have decided to move up north as high costs in the capital begin to bite. Just this year, pharmaceutical company, Otcapharma, and real estate services firm, Cushman & Wakefield, moved into Manchester’s central business district. The e-commerce giant, Amazon, is planning on creating 1000 new jobs in this Northern city by the end of 2016. Considering the increasing employment opportunities, it is unsurprising that Manchester featured in the top 30 cities for investment, alongside London, in a report by the Brookings Institution. Employment rates in Manchester are also predicted to increase by up to 4.3pc over the next 5 years and many graduates are opting to stay in the city. This means that the residential property market will continue to flourish and is good news for landlords. Rental yields are expected to rise significantly as demand from the already 2.5 million strong population continues to outweigh supply.
Northern Powerhouse fuels overseas property investment
Politically, the situation for the city is looking good. Despite previous concerns, Prime Minister Theresa May has decided to push ahead with George Osborne’s plans to devolve power to the city and create a Northern Powerhouse. With over 8000 jobs created in the past 4 years, plans for the Northern Powerhouse envisage a further 850,000 new jobs being created by 2050. Despite initial Brexit-fueled reservations, these prospects for economic growth, teamed with the weakened sterling and interest rate cuts have made Manchester an increasingly attractive option for overseas property investors. Arthur suggests keeping an eye on Manchester’s property market growth over the coming months as the newly appointed Northern Powerhouse Minister, Andrew Percy, continues to fuel investment and infrastructure in the city.