Despite recent turmoil, it seems Manchester is a city on the up, as it is now being identified as a true property investment hotspot. Whilst many investors tend to centre their attentions on London, a booming Manchester housing market means it is not so grim up north these days.
There have been a number of changes in the buy-to-let market lately, but it seems this has not deterred first time property investors, particularly within the Manchester area.
With the city continuing to stay in the top 10 places for rental growth in the UK, it is not surprising that rental yields in the area have reached almost 9% year-on-year, driving investors towards the city in large numbers.
The buy-to-let market in Manchester is experiencing levels of growth that seem to buck the trend of much of the rest of the country.
If it is high rental yields you are looking for, it seems areas such as Pendleton, Claremont, Langworthy and Salford top the charts at 8.84%. Their typical monthly rents come in at £1,034 thanks to their proximity to the centre of Manchester and the University of Salford.
Rental yields of just over 8% can be found in Moss Side, Rusholme and Followfield for easy access to the University of Manchester, whilst the M5 and M38 postcodes also offer returns of 7-8%.
City centre property is always perceived to give good rental returns and so these locations are highly sought after. There have been many concerns about the introduction of Stamp Duty increases and new buy to let taxation laws, but it seems this has not put the Mancunians off the prospect of property investment.
A major regeneration of Manchester has played a significant part in turning it into an investment hotspot. With heavy levels of investment in many of the facilities and attractions in the area, employment has seen a healthy boost and buy to let property is becoming increasingly attractive for those looking to stretch their wings beyond London.
With affordability and rental yields both doing better than those in the capital, many investors are now setting their sights in a northerly direction, particularly thanks to the number of students and young professionals moving to Manchester.
Property investment has often been fuelled by many factors, but it seems to currently be driven by retirement needs, a desire for a second income, the need to start a property portfolio or inheritance purposes.
With low mortgage rates and rising house prices, landlords are still enjoying favourable conditions despite the changes. Wise investments can still be made when looking at the potential yield a property can bring. City centres will always attract a high number of people, and a shortage of property keeps rental demand high, giving great scope for capital growth.
A growing population and the construction of nearly 20,000 new homes around the city means the potential for investment will continue to grow for some time to come.
Mark Burns is the managing director of property investment firm, Hopwood House.