Whether you’re an experienced landlord or new to HMO Manchester Investments, Manchester offers abundant opportunities for high-yield property investments. The city’s diverse tenant base, demand from young professionals and students, and a thriving local economy make it an excellent choice for landlords. However, understanding the best areas to invest in is essential for maximising returns.
We’ve analysed the latest data from October 2024, including SpareRoom’s rental figures and Zoopla’s average sold prices over the last year for three-bedroom terraces—a common property type for HMO conversions. Using a five-bedroom HMO as an example, we’ve calculated gross yields, both before and after an estimated £100,000 refurbishment cost. Actual costs may vary, so make sure to get your own quotes.
| Area | Average Monthly Room Rent (Q3 2024) | Average Sold Price (3-bed terrace) | Gross Yield (Excluding Refurb Cost) | Gross Yield (Including Refurb Cost) |
|---|---|---|---|---|
| Wigan | £553 | £120,407 | 28% | 15% |
| Oldham | £604 | £135,714 | 27% | 15% |
| Rochdale | £590 | £136,986 | 26% | 15% |
| Bolton | £561 | £138,699 | 24% | 14% |
| Bury | £584 | £160,901 | 22% | 13% |
| Salford | £699 | £211,621 | 20% | 13% |
| Manchester | £707 | £221,474 | 19% | 13% |
| Stockport | £643 | £221,351 | 17% | 12% |
| Cheadle | £680 | £276,291 | 15% | 11% |
| Sale | £647 | £328,552 | 12% | 9% |
Key Areas for HMO Manchester Investment
Salford
Salford offers an ideal balance for HMO landlords, with its proximity to MediaCityUK attracting young professionals from media and tech industries. The area’s regeneration and transport links ensure steady tenant demand, and affordable property prices compared to central Manchester add to its appeal. Salford is great for investors seeking strong rental yields and long-term growth potential.
Ashton-under-Lyne
Ashton-under-Lyne provides landlords with affordability and strong tenant demand, driven by its transport connections to Manchester. This suburban area combines convenience and charm, appealing to both students and professionals. Spacious properties are more affordable here, making them ideal for HMO conversions, with ongoing developments supporting growth.
Bury
Bury is popular among tenants seeking suburban living and an easy commute. The area attracts professionals and families with its green spaces and shopping facilities. For landlords, Bury offers stable long-term returns with affordable property prices and high demand from those who prefer a quieter lifestyle with quick city access.
Failsworth
Failsworth is a great option for landlords seeking affordability and strong rental returns. Located 20 minutes from Manchester, this area appeals to young professionals and students who want a more budget-friendly alternative to central Manchester. Failsworth’s local amenities and transport links ensure high demand, providing solid returns for both new and experienced landlords.
Bolton
Bolton provides a cost-effective entry point for HMO investors, offering high yields and strong demand. Although it lacks direct Metrolink access, Bolton’s transport links by bus and train keep it well-connected to Manchester. The area is popular with professionals and families, ensuring rental demand remains steady, making Bolton ideal for long-term investments.
Rusholme
Rusholme is in constant demand due to its proximity to the University of Manchester and major hospitals, attracting both students and medical professionals. Due to Manchester City Council’s restrictions on new HMO conversions, investing here often involves purchasing properties with existing planning permission, which come at a premium but offer higher rental potential. Adding value through refurbishment or adding extra rooms can help offset these costs.
Planning and Licensing Considerations for HMO Manchester
Greater Manchester has strict planning and licensing regulations for HMOs, especially in areas like Manchester City Council, Salford and Trafford, which fall under Article 4 directions. This means converting properties to HMOs requires planning permission, making it more challenging for new applications. In these areas, it’s often best to purchase properties with existing HMO licences or a Certificate of Lawful Development. For more details, check out our article HMO licensing and planning.
Areas outside of Article 4 zones, such as Failsworth, Bolton, and Ashton-under-Lyne, offer more flexibility, with fewer regulatory barriers for HMO conversions. However, all HMOs must comply with safety and living standards, including fire safety measures and adequate facilities for tenants. Be sure to check the specific regulations for your area before investing.
The Role of Transport and Parking in HMO Manchester Investments
Transport links play a significant role in tenant demand, especially among young professionals and students. Properties near Metrolink stops or train stations are highly sought after. Areas like Salford, Failsworth, and Stockport benefit from excellent public transport, ensuring easy commutes to the city centre.
While transport links are important, parking can also be a bonus for attracting tenants who own cars. In our experience, most tenants don’t drive, but offering parking can still broaden your tenant pool. When selecting a property, try and avoid areas with double yellow lines outside, as this can limit parking and indicate a busy main road, which may deter tenants seeking quieter living environments.
Conclusion
Manchester’s HMO market provides excellent opportunities for landlords, with a range of areas offering strong yields and tenant demand. Whether you’re targeting affordable areas like Failsworth and Bolton, or more central spots like Salford and Rusholme, there are options to suit all types of investors. Keep in mind the local planning and licensing restrictions, and always consider transport links and parking, as these factors can significantly impact tenant demand.
If you’re thinking of buying a property to convert into an HMO, we’re here to help. For personalised advice about the best areas to invest in, click here to book a free HMO Q&A call. Let us guide you in making the right choice for your investment.
