Build-to-rent market stabilises in Manchester and Salford

While representing a 55.4% increase over the past five years, the average rent for a new-build apartment in Manchester and Salford remained relatively unchanged over the past 12 months, according to the latest research from JLL.

It is a similar story when it comes to the price of a new-build flat, which rose by 26% since 2020 but only .1% over the past year. Requests by Place North West for the data regarding those exact average rent and price figures were declined.

“Over the last five years Manchester has made itself a more attractive place to work, study and live, which is reflected by the strong sales and rental growth that the city has enjoyed during this time,” said Jonathan Wiedemann, head of the North West at JLL.

“And this shows no signs of changing, with the market remaining steady over the last year. Now it’s important that efforts are made to help increase the supply in the pipeline, helping us to capitalise on this long-term growth and ensure Manchester’s property markets remains an attractive prospect for investors.”

JLL predicts that the next five years will see another burst of growth, forecasting an average sales price growth of 22% in the years to 2029 and 18.8% in rent rates. This will be bolstered by the Manchester and Salford’s current pipeline of 3,960 homes.

The figures come from JLL’s Big Six Residential Development Report, which looks at trends in new-build apartments in Birmingham, Leeds, Bristol, Edinburgh, and Glasgow in addition to Manchester.

Leeds was similar to Manchester in having little growth over the past year in apartment prices and rents, however the other members of the big six all had some increase.

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Birmingham topped the list, with rents increasing by an average of 6% over the past year and prices rising by 5.6% – a trend JLL predicts will continue and ultimately lead to an increase in rents by 18.8% and in prices by 24% for the five years leading up to 2029.

While Manchester’s market remains strong for now, JLL noted that a nationwide slowdown in delivery could have an impact. The report cited increases in the costs of materials and the cost of debt as two important factors. Also: the changes and delays wrought by new regulations, including the Building Safety Act.

The BSA, which has the greatest consequences for buildings of 18 metres in height or taller, has pushed multiple projects back months. The Building Safety Regulator was supposed to deliver verdicts on projects’ designs through its Gateway 2 process within 12 weeks. The median turnaround time for Gateway 2 applications is now 43 weeks, according to the regulator’s comments to Parliament earlier this month.

Marcus Dixon, director of UK residential research at JLL, said: “The slowdown in delivery is most acute in our largest cities, where the proportion of high-rise projects is greatest.

“These delays are adding to the viability challenges already faced by developers, from higher build costs to planning complexity,” Dixon added.

“Without urgent action to streamline the approvals process and unlock stalled schemes, the UK risks falling short of its housing ambitions.”