The Seven Best Places to Invest in Property in the North West
Are you thinking about investing in Manchester or the North West? In today's article, I'm looking at the seven locations I believe are best for investing in property in the North West after 15+ years investing in property in this part of the UK. The focus, here, will be on tenants, demand, growth and investment strategy.
I'm going to be looking at the 7 best locations, I believe, are best for investing in property in the North West and 2 of these, probably, aren't on any lists you are probably looking at.
Now, this list of locations is made up of areas that I prefer based on 15+ years of experience, investing in property.
Not only have I been finding properties, myself and for clients but I have also held properties, over a long period of time.
So I know what the tenants have been like, what the growth has been like, what the availability of decent deals is like, the housing stock. I know what different strategies you can use in these locations.
I have invested across the whole of the North West, from North Wales to North Manchester and all areas in between and have a good grounding on what kind of properties and what locations are working.
The first area - in no order of preference - is Salford. Salford is very close to Manchester. You can walk into Manchester City Centre from Salford in five minutes.
Salford is very close to Manchester but Salford, in terms of growth, has a lot of potentials and there could be a lot of long-term benefits to investing in this area.
The yields are great in Manchester and you can get some very solid yields in Salford, as well, both for straightforward buy-to-lets at maybe 7% or 8% and for HMOs, and other high-yielding, cash-flow investment properties, where you can comfortably achieve yields of 12%+.
There is a lot of potential in Salford, as an area.
Statistics for Salford(Updated April, 2020)
- Five Year Price Growth: 29%
- Avg. Yield for a 3-bed House: 4.9%
- Avg. Price for a 3-bed House: 239k
- Avg. Rent for a 3-bed House: 1,020/pcm
Next up is Tameside on the opposite side of Manchester to Salford. Salford is to the west of Manchester and Tameside is to the east.
The reason why I like Tameside is again, the rental yields are really good but the tenant profile is really good there as well.
You've got great affordable housing in Tameside and there are a lot of properties that make fantastic rentals with this great, professional, tenant profile.
So, Tameside is another good location to consider as well.
Statistics for Tameside(Updated April, 2020)
- Five Year Price Growth: 23%
- Avg. Price for a 3-bed House: 166k
3/ Manchester City Centre and South Manchester
The third locations you should look at are Manchester Central and South Manchester as well. I've combined them here as they offer a lot of the same benefits.
In Manchester, the property growth is fantastic at the moment.
Historically, growth has always been good but this year, capital growth and rental appreciation have been excellent and the tenant profile is very solid, very strong as well. But rental yields in Manchester City Centre and in South Manchester can be a little lower than in other areas.
So, what I advise, if you are thinking about investing in Manchester is that you look at investment strategies that will increase your potential for rental yield. For instance, investment opportunities in serviced accommodation in Manchester are fantastic.
The resale market in Manchester is great as well. So, flip projects can be very profitable. And if you are just after good capital growth and rentals, in terms of a solid tenant profile, you don't have to look far from Manchester.
But, beyond that, Manchester offers a lot of great opportunities for alternative investment strategies like investing in serviced apartments.
And, that's why I love Manchester.
Number four on the list is Wigan.
It's an area you may not have heard of if you're looking at investing in the north-west, as it can fly under the radar.
Wigan offers great, affordable housing - and when I say, 'affordable', I mean affordable in terms of the local housing market and not just in terms of it being affordable for investors.
This distinction is important.
In Wigan, there is a good mix of homeowner demand and buy-to-let rentals. There is a good balance.
In terms of house prices, there is also a lot of potential for growth there as well and the rental yields are really good. You'll get good yields for straightforward buy-to-lets and there are options in Wigan for investing in higher-yield properties like HMOs.
There are a lot of options in this area and as a location, Wigan is a great all-rounder.
Statistics for Wigan(Updated April, 2020)
- Five Year Price Growth: 21%
- Avg. Yield for a 3-bed House: 4.8%
- Avg. Price for a 3-bed House: 134k
- Avg. Rent for a 3-bed House: 559pcm
Number five on the list is Chester. Now, this is a fantastic location for serviced accommodation and a fantastic location for flip projects. Buy and hold and rental yields are a little bit lower than what we'd normally hope for, at least for our portfolio.
There are fantastic tenant profiles and opportunities for great, long-term tenants yields can be quite low.
So, again, maybe you should be looking at serviced accommodation< to increase your yield or, you could focus on flip projects.
Also, the resale-to-homeowner market in Chester is very strong. There is a lot of demand.
In Chester capital growth is good and you can get some great rental yields but I'd also suggest looking at the serviced model and at flips, which, considering the housing demand here, can work especially well.
Statistics for Chester(Updated April, 2020)
- Five Year Price Growth: 14%
- Avg. Yield for a 3-bed House: 4%
- Avg. Price for a 3-bed House: 248k
- Avg. Rent for a 3-bed House: 860pcm
Number six on the list is Warrington. Warrington is similar to Wigan, in terms of why you might consider the area as a good place for investing in property. The yields are good but personally, I think the prospects for capital growth in Warrington are better than they are in Wigan.
The downside is that property prices in Warrington are increasing to the point that they are making yields just a little bit close.
There is, I think, a small window of opportunity for investing in Warrington that will work if you focus on yield and resale but, as an area, it's just on that cusp.
Statistics for Warrington(Updated April, 2020)
- Five Year Price Growth: 20%
- Avg. Yield for a 3-bed House: 3.9%
- Avg. Price for a 3-bed House: 216k
- Avg. Rent for a 3-bed House: 745pcm
Last on the list is Wythenshawe and this is an area of South Manchester which I wouldn't, traditionally, suggest but from a property growth perspective, it's massive.
Wythenshawe is very close to Manchester Airport and there is a lot of infrastructure development going on there. There is a lot of development, there are a lot of companies investing there.
The Metrolink goes through Wythenshawe, it has easy access to Manchester city centre and house prices have gone up significantly. As an area, I think it's still got a lot of property growth left in it.
Wythenshawe is an area that can go under the radar a little bit and yet it is true, that yields can be slightly higher if you go further afield. But, you can get still yields of about 7% plus in Wythenshawe and your growth prospects - your resell market - is very strong there as well.
I think as a long-term play, Wythenshawe looks really good.
Statistics for Wythenshawe(Updated April, 2020)
- Five Year Price Growth: 29%
- Avg. Yield for a 3-bed House: 4.4%
- Avg. Price for a 3-bed House: 205k
- Avg. Rent for a 3-bed House: 789pcm