Over the past few years, the city of Manchester has become more and more popular with property investors; particularly with Brexit just a few weeks away. As well as drawing investors away from the capital, Manchester has also drawn investment with its continuing new supply of high-end developments and economic growth.
There are many other reasons why Manchester has attracted investors to the area, including; it's popular universities and graduate retention rates, it's great overseas investment history, it's superb and expanding transport system and international links, and it's drawn from international and large-scale businesses.
The city has been praised at recent property networking events for its 'impressive economic developments' and 'phenomenal growth over the last 12 months' (Select Property Group). With Brexit just around the corner, there is speculation that by the end of March when the UK is more certain about its position within the EU and the exit deal we have, Manchester will see a "huge amount of pent up investment" come to the area in 2019 and beyond.
These predictions are also off the back of the growing popularity of Manchester with students (both UK and international), the high retention of graduates in the area, and the progression of the Northern Powerhouse and HS2 schemes bringing better transport and new jobs to the area.
Predicted increases in the number of jobs available in the area has been a major attraction for investors and developers alike. The increase in employment opportunities has seen an increased demand for city centre and high-quality accommodation throughout the region.
On 13 February, experts from the property industry gathered at the Insider's Greater Manchester Investment Insight Breakfast to discuss how Manchester may be affected by the UK's withdrawal from the EU. While Manchester has long been predicted to grow after Brexit, unlike some more southern areas of the UK, new insight was also offered at this event as schemes such as the Northern Powerhouse progress.
Tim Newns, chief executive of MIDAS, Manchester's inward investment firm, echoed predictions that post-Brexit, Manchester would be at the forefront of UK investment and development. He also forecast that investment in the city could surge after Brexit as the last remaining unsure investors in London head north.
At this same event, Mark Stansfield, head of UK analytics at CoStar Group UK, spoke about how commercial investment has also been performing well in Manchester, with the strongest demand for office space in the city since 2010; which has in turn meant that there is now an influx of office, retail and commercial space under construction.
Many business have relocated their headquarters to Greater Manchester, including the new BBC park in MediaCityUK, Salford Quays. Following the trend of big businesses opening branches in Manchester, it has recently been announced that GCHQ, the UK's central intelligence and security body, will be opening a new state-of-the-art facility later this year in the city, creating hundreds of new jobs. "GCHQ has the potential to have the same effect, if not more than the BBC's relocation in my opinion," said Newns. "It's a global industry with huge growth behind it. I am massively encouraged by the growth and investment we've seen over the past 12 months. If certainty starts returning, I think we could see a huge amount of pent up investment coming into the market."
It's predicted that this surge of investment in the area will see an increase in property prices, offering some of the highest yields in the UK to investors, as well as capital growth down the line. Select Property Group expects that over the next three years the demand for rental residential property will drastically outweigh the number of available units, especially with a growing young professional workforce.
Property guru Ali Seythanpir has assured UK investors that whilst he believes Brexit will cause turbulence in the industry, this will only be short-term, and cities such as Manchester who are showing strength pre-Brexit won't feel the brunt in the long term. His long-term view predicts that, based on the 2008 and 2016 market hits, UK property will bounce back and will be one sector that is little affected (About Manchester).
With a wealth of jobs in the city, and surrounded by up-and-coming areas, Manchester has seen exponential growth over the past few years. In 2018 alone sales of residential property doubled; as well as seeing an increase in house prices that was well above the 3% national average. Rental yields in Manchester (and other north west cities) also outperformed the rest of the UK in 2018, and these are only expected to rise - around 40% by 2022.
Caroline Simpson, corporate director for place at Stockport Metropolitan Borough Council, also spoke at the 13 February Insider event. Simpson was optimistic about Greater Manchester's prospects and said that from a public sector perspective places like Stockport, Bolton and Rochdale were "at the start of growth and investment."