Lomond Insights: Manchester property market Q2 review

As we reached the midway point of the year, the Manchester property market looks different to the end of its first quarter. Price and inflation changes have knock-on effects in the selling and buying market, while the private rental sector continues to grow.

SALES MARKET

Throughout our region, activity is steady across all price points, with Manchester’s high levels of employment and investment keeping the market afloat, despite recent turbulence. Demand is high in the suburbs for properties between £300-£400k, and apartments in the city remain popular.

Rising costs mean well-insulated, energy-efficient properties are increasingly in demand. Multiple viewings and offers are still occurring for high-quality properties priced correctly, with around two out of three of our properties agreed at above asking prices. However, realism by vendors is critical as buyers are particularly diligent about price point.

LETTINGS MARKET

With mortgage volatility and increasing legislation, we are seeing some landlords in the city selling up, and fewer new landlords registering. The landlords exiting tend to be those with only one or two properties, who are concerned about increasing costs and legislation in the sector.

Professional landlords are still taking the opportunity to buy at good prices, with good yields, supported by the strong rental market. Houses continue to provide the best medium to long-term investment. Good advice is key in supporting landlords through a changing environment and making their investment work hard, especially with the average yield for a two-bed apartment in Manchester currently standing at 7.3% (Dataloft Rental Market Analytics, March to May 2023).

The rental market remains largely in the same place as at the start of the year, with supply down and demand high, particularly with a post-Covid shift back to city-centre living. Manchester experienced the second-highest rental growth of the UK cities, with an annual increase of 13% (Zoopla).

Most of our properties are let within a week, and we are noticing tenants are staying longer and renewing more. Renters in Manchester are spending an average of 25% of their income on rent (Dataloft Rental Market Analytics, March to May 2023). Assuming a renter affordability threshold of 30%, renters are currently within their affordability limits. Location is of top importance, with outdoor space or home working space also highly valued.

HOW WE PERFORMED IN Q2

Despite fluctuations in the current markets, our property experts continue to deliver brilliant service to our thousands of customers.

While we continue our efforts to grow the company even further, our teams produced the following numbers in Q2:

SALES (per branch)

• 45 new instructions
• 334 applicants
• 23 contract exchanges
• 7 applicants per property

LETTINGS (per branch)

• 12 new instructions
• 360 applicants
• 31 applicants per property
• 75 new tenancies agreed

Jason Watkin, Chief Executive Officer, summarised: “Prices are correcting after unstainable growth over the last few years. It remains a good time to buy, with prices only set to increase in the long term.”

You can read the full summary of the Manchester property market below, or click here to learn how Lomond is transforming the UK property market, notably in the investment sector.