Over the last decade, there has been a significant increase of international investors buying into Manchester property market. One would often find positive feedback from people who have invested in the residential property market in Manchester, with many singing praises of good property price growth, very strong rental demand and high rental yields. Let us examine the reasons behind this.
Being the economic powerhouse in the North, Manchester boasts great architecture, a thriving music scene, and is a hub for media and creative industries, healthcare, finance, science and engineering, making it appealing to young professionals. As the birthplace of the Industrial Revolution, Manchester was the world’s first industrial city with first factories and industrial estates, it is where Ford built their first cars in Europe. Today, the city is at the heart of the UK’s largest manufacturing and advanced engineering cluster – the Northern Powerhouse, and is the gateway to the North West, the rest of the UK and Europe.
All of this highlights the strengths and the potential of Manchester where the domestic economic success has been borne out of diversifying from traditional industries into new markets. It is the largest financial services sector outside London and has become the leading city for attracting FDI outside London. Manchester has also established itself as a national tech hub and is home to many key players in the video games industry. Even with the uncertainty in the UK and global economy, Manchester is poised to be a resilient market where it has already cemented its position as the most invested city outside London, reflecting Manchester as the fastest growing city in the last decade.
Strong Fundamentals Underpinning the Demand for Manchester Property
Understanding the macro drivers of the Manchester’s economy is very important to see the huge potential of the city – why it is a place where people want to live and work. The demand to be in the city centre living close to offices and the wealth of cultural amenities in the city is strong. Education is another huge factor contributing to a shortage of housing accommodation in the city. Manchester has 5 famous and popular universities which collectively have 25 Nobel Prize winners and over 100,000 students. In fact, Manchester has the biggest student population of any city outside London and after graduating, the city’s opportunities mean that many graduates tend to stay, making Manchester the UK’s second most popular city for graduates.
All of these, plus the investment and regeneration of many areas, have greatly benefitted the property market overall. The city’s property market is also supported by good transportation links and an international airport upgrade. As with any major infrastructure investment, the future High Speed Rail project will also act a big catalyst in property price growth in Manchester.
In June 2022, the average price for a property in Manchester was GBP250,638 whereas the average price in London was GBP529,829 (Source: HM Land Registry), this significant difference in house prices offers obvious opportunities for investors to get into a major UK city.
How King’s Cross has transformed North London
Previously considered a London backwater, King’s Cross has been transformed into one of the top regeneration hotspots in all of the UK. With the redevelopment projects centring around transport links, infrastructure and new homes, this created a thriving, world-class neighbourhood.
With similar investment getting put into Piccadilly in Manchester through transformative regeneration projects, what does this mean for the new neighbourhood and city as a whole?
King’s Cross was once an unsavoury district of North London but has been transformed into one of London’s top locations. King’s Cross has been one of the most talked about regeneration schemes, and in October 2021, the project turned 10 years old.
Now a decade on, we can see the impact this has had on this part of the capital. King’s Cross St Pancras has become a major rail hub with six underground lines, two national train mainline stations, and Eurostar services.
The 67-acre district also has the capacity for 18,000 jobs, supporting an annual gross value added of £1.42bn. This area of London features 1,120 homes and an additional 623 are under construction.
Public squares and parks have become well used, heritage buildings have been sensitively restored and former industrial houses have been repurposed. There are now sophisticated shops and impressive architecture, and it’s evolved into a thriving community and creative quarter.
With this improved liveability, the property market in King’s Cross and the surrounding area has taken off. The rental market has been thriving with demand increasing, particularly among professionals. This has also led to growing house and rent prices.
The plans for HS2 at Piccadilly Manchester
Much like the King’s Cross redevelopment, Piccadilly Central is set to be transformed from underused industrial site to a lively mixed-use community hub with unrivalled transport links.
The new Piccadilly HS2 train station is expected to cut travel times between some of the biggest cities in the UK. From Manchester, a train to Birmingham is forecast to take only 41 minutes and 63 minutes to London.
At the Piccadilly station, there will be six platforms at the surface level, which will allow passengers to access both HS2 and Northern Powerhouse Rail services. There are also proposals to build a new Metrolink station beneath the HS2 station with four platforms to further improve transport links.
The first stages of construction for the station are predicted to start in 2025. Current plans for HS2 would see the new station open between 2035 and 2040. This transport investment in Piccadilly is bringing forward additional regeneration and investment, which is expected to fully transform this part of Manchester.
The Impact this Investment is expected to have on Manchester
There are regeneration plans for the area surrounding the Piccadilly train station. The masterplan is set to create a vibrant and distinct new neighbourhood, Piccadilly Central. This will capitalise on the connectivity that HS2 is going to deliver and create an impactful arrival for those entering the city through the station.
The new neighbourhood Piccadilly Central will provide a public square, community spaces, retail spaces, new streets and excellent pedestrian connections. On top of that, the site brings opportunities to provide much-needed new housing and employment spaces, which will make it a particularly exciting area of Manchester to live, work and invest in.
Piccadilly Central is expected to become an attractive and unique destination for residents and visitors alike – much like Kings Cross has over the last 10 years.
At the heart of the new Piccadilly Central neighbourhood is a vibrant new development – Victoria Square where it will act as the gateway to a new public square and boulevard leading to the new HS2 station. Victoria House is the first high-quality residential scheme in this area and is designed by the award-winning architect Simpson Haugh. The project comprise of 177 apartments across 25 storeys with luxurious amenities and lifestyle services. Apartment prices start from GBP258,000 and the project is estimated to complete in Q2 2024.
Victoria House will be launching in Malaysia for the first time exclusively with RBC at the Mandarin Oriental Hotel KL (Parkview 1) on 15th & 16th October 2022.