UK government’s ‘Northern Powerhouse’ scheme is driving property boom in thriving Manchester, Liverpool
High rental yields, job creation and population growth are making the UK’s great northern cities property investment hotspots for overseas buyers
Property in Manchester and Liverpool is seeing an investment surge despite predictions of slowed growth following Brexit.
Indeed, property prices nationwide have shown resilience following the EU referendum, rising 5.6 per cent on an annualised basis in August, up from 5.2 per cent in July. It is now clear that the government’s ‘Northern Powerhouse’ strategy, to boost the economic growth of the North of England, is continuing to advance under the leadership of new Prime Minister Theresa May.
Investors with an interest in UK property will long have been aware of the excellent market conditions in Manchester, but increased links with China are bringing the city to the attention of a new generation of potential buyers.
Known as the ‘Capital of the North’, and once nicknamed Cottonopolis for its leading role in the Industrial Revolution, Manchester has a lot to interest property investors. Its economic performance, its position at the centre of the ‘Northern Powerhouse’, and the supply-demand imbalance in housing are all key structural factors, but most important of all is the exceptional value investors can find there.
Manchester and Liverpool offer very attractive rental yields, and with demand expected to increase significantly over the next five years we are confident this trend will continue
Above all, though, it is the booming economy that is driving the city’s investment case. Greater Manchester’s gross value added, a measure of the value of goods and services produced in an area, is now higher than that of the Northeast, West Yorkshire or Merseyside, and is forecast to grow 32 per cent to £75bn by 2024.
All importantly for property investors, there is a considerable and growing supply and demand imbalance in the city’s housing. Over the next decade Greater Manchester’s population is expected to increase by 128,000, and it is thought that 110,000 jobs will be created over the same period. What’s more, there will be a 14,000 reduction in manufacturing jobs alongside a 31,000 increase in professional, technical and scientific roles, meaning that Manchester workers are moving into higher wage brackets. All this comes against the backdrop of a supply shortfall that cannot be met, ultimately pushing prices up.