Investing In Manchester & The Northern Powerhouse

Investing In Manchester & The Northern Powerhouse

12th March 2018

Investing In Manchester & The Northern Powerhouse

You might already have heard about the Northern Powerhouse. In this post we will explain exactly what it is, as well as what it means for property investors.

First of all, what is it? Northern Powerhouse is a UK Government proposal to link together the economies of the towns and cities of northern England. Currently the northern towns and cities are much less prosperous than London. The Government believes that by joining forces they could create a ‘super economy’ similar to Greater London – one of the world’s biggest economies.

Where does the Northern Powerhouse cover? All the cities and towns across the north including the north west, north east and Yorkshire. The main cities it covers are Manchester, Liverpool, Leeds, Sheffield, Hull and Newcastle.

Within this, Manchester is very much the self-styled capital of the Northern Powerhouse. It already has the strongest economy in the north, successful modern industries, tens of thousands of well paid jobs, and top universities. The City of Manchester itself is one of the UK’s fastest growing cities – today’s 520,000 population is forecast to reach 625,000 by 2025 – and it is already an investment and development hotspot.

What exactly will Northern Powerhouse involve? City devolution is a key element. This means that city regions each headed by an elected city region mayor are being created. Each of these will take over powers in key areas such as economic development, housing and transport and receive extra money to invest in their regions.

Liverpool and Greater Manchester already have an elected city region mayor. In Greater Manchester mayor Andy Burnham has already started work on improving the transport system and tackling the housing shortage.

Transport is another key element. A new body called Transport for the North or TfN has been created with the aim of transforming regional transport links. The Northern Hub project is already delivering better rail services to and through Manchester. Longer term there could be a new high speed railway, HS3, speeding between Liverpool, Manchester and Leeds, and a major new road linking Manchester and Sheffield.

So why should you invest in Northern Powerhouse cities? There are a few good reasons: When money is invested in a location, particularly in infrastructure, the economy benefits and jobs are created. That usually boosts demand for property to rent or buy, and pushes up rents and property prices. The investor who buys in at an early stage could benefit from excellent rental yields and capital appreciation.

There is some evidence this is happening already. According to HM Land Registry, average property prices in Manchester rose by 10.9% in 2017 and in Liverpool by 9.5%. These are some of the highest price rises in England and compare to the national average rise of 5%.

Also bear in mind property prices across the Northern Powerhouse are low – often just 20% or 10% of London boroughs. So it is cheaper to buy in and there is potential for high growth.

So if you’re interested in investing in the Northern Powerhouse what options are available to you? The region offers pretty much every kind of property investment, including commercial and residential, suburban and city buy to let and student property – offering a somewhat bewildering range of opportunities.

One option we would suggest is off plan investing. Good reasons for investing off plan include low buying-in prices, the ability to pay in stages, and brand new property that is always popular with tenants and often offers enhanced yields. There may even be scope to make money before your property is finished if values rise before completion. In this regard Manchester has a particularly wide range of off plan investment opportunities, with a number of appealing schemes across the city.

If you are interested in investing in Northern Powerhouse cities Property Circles Network will be pleased to guide you through the opportunities – just give our experienced team a call on 0161 250 7666.

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