Manchester named UK’s ‘new property powerhouse’ after house prices soar

Manchester has been awarded the title of the UK’s new ‘property powerhouse’ after a recent surge in house prices. The latest analysis from Open Property Group has revealed that when it comes to house price growth, Manchester has far outperformed other major UK cities over the last year – including London.

According to the latest Government house price figures, property prices in the city are increasing much more than the national average. Rising house prices give a good indication of the state of the market, with growing demand often being one of the key factors that drives prices up.

The professional house buying company analysed the latest data by looking at house price performance over the last year across 10 major cities. The research shows that across England, the average house price has fallen by -1.5 percent on an annual basis, as market activity has been dampened by higher mortgage rates coupled with the ongoing cost of living crisis.

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This downward trend has been mirrored across seven of the 10 major cities analysed by Open Property Group, with London seeing the largest decline at -3.9 percent, while Bradford and Birmingham have also seen some of the property prices fall by more than 2 percent.

But not all major cities have followed this trend with both Leeds (+0.6%) and Newcastle (+2.1%) showing house price growth up to 2.1 percent. But Manchester has been the best performing city by far, with the average house price climbing by 5.8 percent year on year.

The experts say this is an ‘impressive performance’ for a city that, with a population of 568,996 people, is home to a far smaller property market compared to the nation’s first and second cities of London and Birmingham.

According to Rightmove, properties in Manchester had an overall average price of £296,989 over the last year.The majority of sales were semi-detached properties, selling for an average price of £328,004. Terraced properties sold for an average of £244,622, with flats fetching £198,905.

However, Manchester hasn’t remained immune to current market conditions as the latest transaction figures show that Manchester home sellers may struggle to secure a buyer in the current market.

Just 295 homes sold across the city in 2023, with only Newcastle and Leicester seeing a lower level of market activity. This marked a -38.2 percent drop in sales vs the previous year, the largest annual reduction in buyer activity seen across all major cities analysed by Open Property Group.

Jason Harris-Cohen, CEO of Open Property Group, said: “In contrast to Birmingham, Manchester has gone from strength in recent years and while it may be looking to cement its place as the nation’s ‘second city’, it’s fair to say that it’s outperformed even London when it comes to current house price performance.

“This is great news for Manchester homeowners but that’s not to say that the current market isn’t without its challenges. While market conditions are improving, the higher cost of borrowing remains a considerable obstacle for homebuyers and, as such, the number of homes sold across Manchester has reduced notably year on year.

“This means that home sellers may struggle to find a buyer in a proceedable position and this can considerably increase the time it will take to sell their home. A protracted selling timeline is one of the biggest motivations we see when it comes to sellers opting for a quick sale platform.

“Having benefited from a strong level of house price appreciation, they simply want to secure their sale and move forward with their onward purchase. The ability to do so to a strict and swift timeline allows them to cash in and make their move.”