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The December 2017 buy-to-let index from LendInvest named Manchester as the best buy-to-let area in England and Wales. It came top for rental yields (5.55 per cent) and rental price growth (5.76 per cent). With the city established as a great place for buy-to-let, we explore the best buy-to-let areas in Manchester for 2018.
Manchester is one of the core ‘northern powerhouse’ cities, so it’s receiving plenty of infrastructure investment. And a £70 billion proposal to transform transport in the north has recently been unveiled, which could help create thousands of jobs and boost the region’s economy.
Manchester also boasts four universities and a student population of 100,000. Manchester’s great rental yields and its bright future mean it’s worth giving the city some serious thought.
These are some of Manchester’s buy-to-let hotspots.
The M6 postcode boasts the best rental yields in Manchester according to research from Totally Money, with yields of 8.25 per cent. It ranks 14th overall in Totally Money’s table of the top rental yields in England, Wales, and Scotland.
The M6 postcode includes Pendleton, Claremont, and Langworthy, as well as part of Salford. It’s not far from the centre of Manchester, and the University of Salford is close by, so it’s a popular area for students.
This postcode is one of the best buy-to-let areas in Manchester. Investors are currently seeing average rental yields of 7.98 per cent, according to the latest buy-to-let hotspots map from Totally Money.
South of the city centre, the M14 postcode includes places like Fallowfield, Rusholme, and Moss Side. The main University of Manchester campus is nearby, so this is the most popular part of the city for student rental.
Moss Side was once notorious for riots and gang violence, but it’s received lots of investment that’s helped to turn it around. It only takes ten minutes to get into the city centre by bus, and there’s a good cycle network too.
We briefly mentioned Salford above. As you can walk into the city centre in five minutes, Salford is a great location for someone looking to rent a property.
There’s lots of growth potential in the area. MediaCity is based there – it’s been claimed the development will double in size by 2030. With great rental yields and long-term prospects, Salford is an area you should consider.
Tameside is to the east of Manchester, whereas Salford is to the west. Tameside has great rental yields and a good supply of all types of properties. Towns in Tameside include Denton, Droylsden, and Stalybridge, so these could be good areas to explore for buy-to-let.
The tenant profile is apparently strong and properties are affordable, which makes for great rentals.
Rental yields in the city centre can be a little lower than other areas in Manchester, but there are opportunities to consider different investment strategies.
You could look at flip projects and investing in serviced apartments, which should still let you get a part of the good capital growth and solid tenant profile in the area.
Good transport connections are key to attracting tenants and to reselling the property when the time comes. Data from Nationwide in 2015 showed that buyers in Manchester were prepared to pay 4.6 per cent more on average for a home within 500 metres of a tram stop.
As we said, Manchester is a thriving student city, so be mindful of where the university campuses are. Look for the popular student areas, because student rental can bring particularly good rental yields.
Property development is booming and Manchester’s skyline is changing, so look out for the areas that are up-and-coming and receiving investment. But if there’s lots of new housing going up in a particular place, it could lead to oversupply and plummeting rental returns. Be wary of this when looking for the best buy-to-let areas.
Are you thinking about investing in buy-to-let in Manchester? Tell us in the comments.
Sam has more than 10 years of experience in writing for financial services. He specialises in illuminating complicated topics, from IR35 to ISAs, and identifying emerging trends that audiences want to know about. Sam spent five years at Simply Business, where he was Senior Copywriter.
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