Manchester is one of the best student areas for buy to let investors in the UK, research has revealed.
The city has come third out of a list of top student buy to let towns and cities, according to data released by zoopla.co.uk and for a typical four bedroom student property, the average gross yield comes to 4.59%.
This figure comes just behind Glasgow and Hull with yields of 4.95% and 4.80% respectively.
There are more than 100,000 students in Manchester across its three universities and there has even been a 30% increase in 20-30 year olds moving to the area. In the last 10 years alone there has been nearly a 20% increase in the population so why are so many people choosing Manchester?
Outside London, Manchester boasts the largest UK economy so it’s easy to see, due to the number of students, why the rental sector is being heavily relied upon.
Living in the north is another big factor. A much higher yield is generated due to the lower property value meaning a higher demand for students.
Zoopla released figures which state the average monthly rent for a four bedroom house is £1,053 and the average asking price is £275,132.
Landlords are always looking at the best returns especially in university towns so it’s little wonder that they thrive in such vibrant areas.
Christian Spence, Head of Business Intelligence at Greater Manchester Chamber of Commerce, said: “Buy to let is a very good investment in the current climate as mortgage rates are low and rent levels are rising. Meanwhile savings rates are low so many people with money to invest are putting it into property.
“Manchester is a great place to live and work so there’s a huge demand for rental property as many young people are struggling to raise the deposits needed to buy their own home, therefore it’s no surprise that buy to let is on the increase.”
Zoopla’s recent figures confirm the huge popularity and best value in Manchester.
Lawrence Hall of Zoopla.co.uk said: “The yields are high in this area compared to other areas. There are 48 big student towns but Manchester has a big student population and rents should remain sturdy and pretty high.”
He also believes that the areas which benefit most are Salford and the suburbs around the universities.
Greg Davies, branch manager of Reeds Rains, said: “There are soon to be a lot of overseas students coming to the area who will typically have more money than British students in order to get over here. There should be a real pique in letting activity around July and August.”
Image courtesy of mwmbwls via Flickr, with thanks.