Demand for Manchester property rises among overseas investors
Manchester is one of the most popular UK cities for property investment among buyers located across the GCC region.
Investors in UAE, Saudi Arabia, and the wider GCC voted Manchester as the most popular UK city to invest in behind London, citing economic growth and Brexit uncertainty as key motivators.
GCC is the Gulf Cooperation Council, a regional political organisation comprising the energy rich Gulf monarchies – Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.
Of the 367 investors surveyed by global property developer, retailer and operator Select Property Group, almost 80% agreed that the UK was a strong place to invest in property, with 13% highlighting Manchester as the top place that appealed to them, second only to London.
The increase in interest from overseas investors follows a sharp rise in property prices in Manchester.
The city saw prices increase 7.4% in the 12 months to June 2018, with property values expecting to surge 81% faster than the UK average by 2022.
Adam Price, managing director at Select Property Group, which has a Manchester base, said: “The heightened popularity of Manchester within the property market is a trend that’s been earnestly followed by shrewd investors – not just those from the UK, but by those overseas, too, and our new research corroborates this.”
Almost 70% of the investors agreed that rental yields in Northern cities are greater than London, with over a third of investors revealing that they choose UK cities based on where capital growth is strongest.
Mr Price added: “It’s becoming clear that London, which was once hailed as the best UK city to invest in, can’t offer the levels of growth it once did. Prices are reaching an affordability ceiling and, coupled with slow yield growth, it makes for an increasingly difficult investment to justify.
“Manchester, with its low supply and strong growth forecasts, presents a huge opportunity for investors to enter the market during the city’s exciting period of economic growth.
“Monthly rental rates are also expected to accelerate 40% faster than the UK average by 2022.”
The results of the research by Select Property Group also revealed that the increased interest in Manchester property could be due to the effect of economic and political events.
More than 70% of GCC investors believed that Brexit has made UK property more affordable, with almost 70% admitting that wider economic and political events have impacted their investment decisions.
Adam Price said: “The uncertainty surrounding Brexit has, subsequently, caused a fall in the value of the pound, meaning UK property is now as much as 12% cheaper to new investors.
“This has led to an increase in interest from overseas investors.
“However, once Brexit negotiations with the EU conclude, uncertainty is lifted and Britain’s economy begins to stabilise, those that invest now will see the strongest capital gains and returnon investment in the coming years.”