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Manchester's rental market taking a hit

18/07/2008

Manchester has seen "notable falls" in rents in the past few months because of the oversupply of new-build apartments, it has been claimed.

While rents have increased in London, Leeds, Edinburgh and Bristol, landlords in Manchester and Birmingham are reporting falling demand, reports the Times.

Moreover, landlords have been hit by rising borrowing costs, especially those who have come off fixed rates and now face higher payments, known in the industry as 'mortgage shock'.

But David Newnes, the managing director of Your Move, told the paper that "opportunities to invest are ripe for professional landlords who can secure financing".

In fact, studio apartments are likely to increase in popularity now that property price growth is slowing down, according to Andy Finch, the head of new homes sales in Manchester for Knight Frank.

He recently told the publication that Manchester property buyers can save between £20,000 and £25,000 on a studio apartment, compared with a small one-bedroom unit.

"When the market weakens and prices slip a little, it brings studios within reach of a wider audience," he explained.

Land Registry figures show that house prices in Manchester rose by 3.2 per cent in May, bringing the average cost of a home in the city to £115,687.