How HS2 is set to heighten Manchester property development
Manchester is on the cusp of a new era of regeneration. HS2 - the UK’s new high-speed rail network - has recently acquired a second location within the centre of the city, and the announcement is expected to drive Manchester property investment.
The second site - at Travis Street’s Square One - is located close to Manchester Piccadilly train station, and has been purchased by the Department for Transport for an undisclosed fee. A spokesperson has stated that the site is “pivotal” for the success of the HS2 project.
Manchester has already witnessed growth as a result of previous HS2 announcements, with stops at Piccadilly and Manchester Airport having previously been confirmed. Several developers have announced regeneration plans in the vicinity of Piccadilly, with construction already underway on an all-purpose “Piccadilly neighbourhood”.
What is the purpose of HS2?
HS2 is a new rapid-speed rail network which connects London to the North. Trains will link Glasgow, Edinburgh, Manchester and Birmingham with the capital. The project is part of the government’s pledge to “level up”, with the purpose of connecting the largest economies in the country. As a result, businesses are being encouraged to concentrate outside of London and establish themselves in the North and the Midlands.
While the current rail infrastructure provides an important corridor throughout the heart of the country, it simply isn’t sufficient to meet the demands of modern UK businesses. The West Coast Main Line, for example, has its roots in the Victorian era and suffers from overcrowded and often unreliable services.
It is the view of both Westminster and commerce experts that substandard train services are holding back areas of the North and the UK economy as a whole. Having investigated all options, the government has concluded that the current rail network cannot be improved much further, and any interim upgrades would bring both long and short-term disruption. The solution is to deliver a brand-new rail line with the purpose of creating greater connectivity between regions and providing greater capacity on the national rail network.
How is HS2 impacting property investment in Manchester?
Since the turn of the millennium, Manchester has been considered a “second city” to London as far as property investment is concerned. Manchester property investment has been a safe bet for developers and buy-to-let landlords for a number of years, on account of low property prices, high capital appreciation, increased housing demand among tenants and strong rental yields.
The latest HS2 announcement is expected to drive development in the city even further, with investors seeking to hone in on Manchester property development. It’s not just local investors either - overseas developers are increasingly investing in UK property, and Manchester is set to see an influx of foreign interest.
Ruth Todd, the CCO at HS2, has stated that the acquisition of powers to both construct and operate a high-speed line between Manchester and Crewe represents a “major milestone” in bringing rapid connectivity to the North of the country. Todd added that the HS2 purchase of Square One had been a “vote of confidence for investors, locally and internationally”.
The development is one of the largest in the UK at present, with investment expected to create 13,000 new homes, over 800,000 square metres of commercial space and up to 40,000 new jobs. Once completed, the new Piccadilly neighbourhood will feature retail space, a public square, community areas, new streets and an improvement in pedestrian connections.
Is buying property in Manchester a good investment?
Property investment is one of the safest asset classes UK has to offer. Whether you’re investing in UK property as a buy-to-let landlord or utilising real estate investment trusts as a means to help your capital to grow, property is a safe bet.
However, choosing the right location to invest in is key. Areas with high housing demand, low house prices and strong rental yields are ideal for property investors - and Manchester offers the perfect combination of all three.
Figures from June 2021 have demonstrated that house prices in Manchester have increased by over 9% in just twelve months, with the average property in the city now being worth over £217,000 - a staggering £55,000 below-median UK prices. Huge demand for housing in the area has meant that Manchester has become one of the first-choice destinations for investors who are seeking to capitalise on high levels of capital appreciation and strong rental yields.
Is Manchester a good place to buy to let?
Over the past five years, several studies have concluded that Manchester is an incredibly strong choice for buy-to-let investors. The wider Manchester area as a whole is performing well, and the recent HS2 announcement is expected to boost prices, rental yields and demand for housing in the city centre.
Manchester is home to a huge university population and is also populated by tens of thousands of young professionals - two of the largest rental demographics. Recent regeneration announcements will further bolster demand for housing, and with comparatively low property prices the city should be on the shortlist for any savvy buy-to-let investor - particularly when rental yields are so strong.
Ultimately, Manchester property investment offers a steady income stream for buy-to-let landlords in conjunction with high capital appreciation. This makes it one of the best areas of the UK for property investors to focus their attention on.
Find out more about Manchester property investment
Whether you’re a newcomer to property investment or looking to expand your existing portfolio, why not sign up to PropertyData for a free two-week trial? As a member, you will gain access to a wealth of tools and resources which can guide you towards making more informed Manchester property investment decisions. With up-to-date property prices by postcode, a rental yield calculator and tips on what to look for in a buy-to-let property, you could be better positioned to make smarter investment choices.