A broker’s view: why Manchester is the best city for buy to let investment

What do you think of Manchester being number one? Does it come as a surprise? 

No surprise at all as there has been a lot of buy to let activity in the North West compared to previous years. Manchester has regularly featured as a hotspot due to market prices and the ever-growing student population makes for a good investment.
How do you think the buy to let market has changed in Manchester in recent years?

From a bird’s eye view of Manchester it could be mistaken for a mini-Dubai with all the cranes!  There has been a huge investment in commercial in the city centre and many new residential blocks with excellent facilities for the rental market.
What do you think that the main reasons are for investing in BTL properties in Manchester?

Well, it's a great place to live! Rental yields are very strong, and the more experienced landlords will have done their maths when investing in this fine city.  Some major companies have adopted the North as their HQ, and with excellent transport links Manchester serves as the second city.
How have you, and landlords, adapted to the challenges that Covid-19 has brought?

The lender criteria changes certainly made for lengthy discussions with landlords.  The loan-to-value (LTV) drop was one of the biggest issues for landlords not wanting to utilise more of their liquid cash.  However, the reduction in stamp duty has resulted in a surge of new business.  First time landlord enquiries have also risen as they have seen a further increased demand for rentals and are wanting to capitalise in this market.

Since the Covid-19 outbreak, do you think there has been changes in the requirements of renters in Manchester?

Renters are wanting more for their money, they want value, they want a landlord who will commit to their needs.  Outdoor space has been a specific search criteria for renters, understandably.  Some of my clients who were ready to proceed with their first home prior to lockdown were unable to due to reduced income/redundancy/uncertainty of employment etc.  The discussions were very distressing for some clients, their dreams shattered and no longer able to get on to the housing market anytime soon.  Their need to stay in rented accommodation made them realise they want more for their money.
How do you think the stricter lockdown measures in Manchester has affected affect the future of the city?

Like all cities, Manchester has suffered.  I live in the city centre and during first lockdown the place was unrecognisable. It was really sad to see this vibrant city come to standstill.  The second lockdown has seen the city busier, and it will continue to recover.  However, unemployment is already high and, with the recent news of the Arcadia Group, our high street could look very different in the future.  The potential loss of employment will have a big impact.
Any other comments you would like to make?

The New National Infrastructure Bank is a great investment for the North.  New homes, employment, transport networks and 4G Broadband will be a well needed boost to the North.

Jasvinder Jhumat CeFA, CeMAP
Financial Adviser

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