Manchester’s rental market is continuing to boom with demand and rents on the rise. As the city in the North West keeps growing in population and industry, this is expected to only further elevate the region’s property market, including the rental sector.
Here we’ll cover property operator urbanbubble’s latest research in their Manchester Monthly Snapshots.
Rents hitting record highs
Across Manchester, rents hit another new record high in January 2022 and had been rising fairly consistently since April 2021. Studio and two-bedroom apartments and houses with two or more bedrooms saw the fastest increase in rents to start the year.
Studios increased by 10.0%, or £76 pcm, in only one quarter. This increase has taken the average studio rents to above £800 pcm for the first time. Rents for one-bedroom apartments in Manchester rose by 5.4%, or £47 pcm, during the past quarter, while two-bedroom flats and three-bedroom flats increased by 8.0% and 4.8%.
With these strong rises in rent, there are still no signs that rental market activity will slow down. In the first month of this year, 517 properties were let in the city. This is significantly higher than the pre-COVID January average of 328, as it’s usually a quieter month.
Additionally, every month in 2021 saw lettings numbers remain above the pre-COVID average. This continues to show the resilience of Manchester’s rental market and the city as a whole.
Supply and demand imbalance
The increasing rents across Manchester is largely due to strong tenant demand and lack of supply. On the last day of January, there were 945 vacant rental properties, which is 1,648 less properties on the rental market than at the same time last year. At the end of February, there were even a whopping 75% fewer vacant rental properties than in 2021.
Short supply paired with strong demand has restricted choice for renters and has caused rent prices to continue to increase. This is defying annual trends as rental availability usually increases towards the summer months.
The number of properties available to rent crept slowly upwards in Manchester during January. However, this is still far below year-on-year figures, and the number of available properties dwindled again at the end of February.
Thousands of rental properties in Manchester were let between June and August last year. This means the majority of those that were six-month tenancies have already come to an end, while the end of 12-month tenancies could create more availability in the market during the coming months. However, this depends on tenants not renewing their leases.
A rise in new developments
In Manchester, new-build property completions are on the rise. This will help the market keep up with the growing demand for housing across the city. Since January 2012, an impressive 23,606 homes have been built, according to urbanbubble, and 1,896 new homes have completed so far in 2022.
A further 4,031 properties are due to be delivered by the end of the year. Additionally, a total of around 12,700 homes are currently under construction, while 945 additional homes were submitted for planning in February.
Office space completions are increasing as well. Over 3.4 million square feet of office space has been built since January 2012. And since December 2021 alone, 36,484 square feet of space has completed with even more schemes currently under construction or at the planning stage.
With more businesses opening their doors and moving to Manchester, this will only bring more people to the city. And as office completions increase, there is capacity for more businesses and professionals to follow suit. This is further cementing the city as the UK’s most important business and economic centre outside of London.
As more exciting developments are on the way, this will help increase the supply of high-quality properties and office space in Greater Manchester and help the market keep up with the ever-increasing demand.
At Salboy, we have a range of new-build and off-plan property developments available across Greater Manchester. If you’d like more information and personalised advice about investing in the area, get in touch with our team of advisors.