Steve Swyny, Head of Sales at F4B
The property market has suffered from a sustained period of political and economic uncertainly in recent times but 2020 has already seen a healthy rise in activity levels, especially across the North West of England.
A recent landlord survey from Simply Business highlighted London and Manchester as the most attractive cities for buy-to-let investment in 2020. When asked – which city represents the best investment opportunity – these two cities received over a third (18% each) of votes with Liverpool and Birmingham in joint second.
London has all too often been the focal point for discussion of activity around the housing market and house prices. Whilst this will remain the case for some commentators, increasing numbers of property professionals are looking beyond the capital and exploring investment opportunities in regions which can offer greater longer-term yields, the ability to mitigate risk and provide the opportunity for portfolio diversification.
Manchester and the North West
Focusing on Manchester and the North West, the mood in the area remains buoyant. Property professionals in this region don’t need Northern Powerhouse undertones to realise that a real push in being made in the supply of much-needed affordable housing and a stronger commercial infrastructure.
Research from Savills outlined that Greater Manchester is forecast to grow at a rate of 14% over the next five years, well above the UK average of 11%. Additionally, it outlined that Manchester has attracted more foreign direct investment in the past decade than any other city outside of London and is home to over 2,000 foreign-owned companies. It has also become home to a thriving tech sector and is worth an estimated £2.9bn, employing 83,000 people, and accounting for 35% of commercial property in the city.
This expected growth is backed by further data from Halifax which suggests that eight of the top 10 places with the strongest property price increases during 2019 were towns located in the North West of England. Billingham, a town in the North East, was home to the largest growth with the average price increasing by 12.3%. Ilkeston, in the East Midlands, saw a price rise of 9.1%. The following eight places were exclusively towns in the North West, including Sale, Wilmslow, Blackburn, Bolton, Burnley, Chorley, Bootle and Southport. House prices in each of these towns boasted a 6% rise or more.
The benefits of investing in northern towns
There are many reasons for a wider range of property professionals to consider investing in Northern regions. The government has also recently announced plans to regenerate 45 towns in the North through the Future High Streets Fund. This will regenerate town centres, boost local business and improve infrastructure, while benefiting the local property markets. All factors which are appealing for a range of investors and developers.
It’s clear that demand is rising for alternative lending solutions to meet the diverse range of property-related opportunities emerging throughout this region. This trend has not gone unnoticed throughout the intermediary market, with greater numbers of brokers seeking the support of specialist distribution partners.