The Best Areas For Student Property Investment In Manchester

In the UK, student property has proved a popular and profitable asset for investors – owing to a large population of students, a critical undersupply of accommodation, and a growing appetite for higher-quality living.

Within the student market, there are certain cities in the UK that stand out as particularly fruitful.

Manchester is one of them.

Famed for its historical significance, sporting glory, and ongoing contributions to British culture, the city has also carved a deserved reputation as an educational behemoth. And, naturally, that attracts investor interest.

However, student property investment in Manchester poses its own set of challenges, especially when it comes to identifying the most promising areas. It’s particularly difficult if you’re not from the region, and have no knowledge of where the city’s students tend to favour.

Our guide aims to demystify the process, providing a detailed overview of the best areas across the city for student property investments. Whether you’re expanding your portfolio or taking your first steps into property, this article is designed to equip you with the insights needed to make – as the locals would say – sound decisions.

Why invest in student property in Manchester?

The most obvious reason to invest in Manchester’s student accommodation is the size and scale of the region’s education sector. There are two fantastic universities in the city centre, a further two nearby in Bolton and Salford, and specialist institutions like the Royal Northern College of Music. All of which contribute to a student populace of more than 90,000 across the region (according to HESA).

For context, that makes Greater Manchester the third-most popular region for students in the UK, after London and the West Midlands.

Even so, there are plenty of cities and towns with large student populations, so before we go any further, why should Manchester get your attention?

There are two main reasons:

• Our research has found Manchester generates some of the highest yields in the UK. M14 – a student-heavy postcode which we’ll discuss further later – is the top-yielding postcode in the country, with average rental yields of 12%.
• There’s a severe undersupply of student accommodation, with reports suggesting a shortfall of more than 23,000 beds. In the short term, this means higher rental prices and fewer void periods. In the long term, it’s likely private developers will seek to fill the gap with juicy PBSA projects (again, more on this later), thus creating more investment opportunities.

The 5 Best Areas For Student Property Investment In Manchester

So now we’ve established Manchester’s impressive credentials, let’s move on. Where are the best areas for a student investment property?

We’ll try to answer this question as thoroughly as possible. One difficulty is that while students often live in concentrated pockets, those pockets can be one small part of a wider area with multitudes of other residents – families, young professionals, etc.

So, to get the full picture, we’ve leaned on our local knowledge and mixed it with market data.

The results are below:

1. Fallowfield & Rusholme (M14)

Fallowfield is the hub of student life in Manchester.

The University of Manchester has first-year accommodation buildings and student villages here, along with the university-owned Armitage Sports Centre. Meanwhile, Wilmslow Road, which runs through the centre of Fallowfield before connecting with Rusholme, is a hotbed of activity – with students opting to live in the estates of Victorian terraces on either side of the main road.

The proximity to the campuses of the University of Manchester, Manchester Metropolitan University, and the city centre (all walkable but served by regular buses too) help make Fallowfield a popular choice, but a big driver is the area’s reputation for being in the thick of the student action (think late night parties, special events, and more).

The demand for student housing in the area means this is the number one postcode for rental yields not only in Manchester but the entirety of the UK with a huge 12% yield. Moreover, an increase of 41% in average property prices over the past year makes M14 the top choice for both rental profitability and long-term capital growth.

2. Oxford Road (M13)

Eventually, if you continue to follow Wilmslow northbound towards Manchester city centre, going through the famous Curry Mile along the way, it becomes Oxford Road.

Oxford Road is another student-heavy area, attributable to the fact that both university campuses are predominantly based along the road. Student unions, lecture halls, and other university buildings co-exist alongside music venues, bars, hospitals, and more, with student properties most commonly found on the side streets around Oxford Road.

The area is covered by the M13 postcode, which generates an average rental yield of 8.2% – the second highest in our list.

One thing to note though, M13 also covers Longsight (to the southeast). Although Longsight has huge potential for residential buy-to-lets aimed at families, it’s a less popular choice for student tenants – so keep that in mind when looking at M13 properties.

3. Salford (M6 and M5)

West of Manchester city centre, and across the River Irwell, you’ll find yourself in Salford.

The University of Salford, with 23,000 students, is set on the dividing line between the M5 and M6 postcodes. While most attendees will live close by, unlike Fallowfield and Oxford Road, it is not dominated by their presence.

In fact, the area has seen extensive (and intense) regeneration schemes over the past decade and has shifted its focus towards a young professional crowd – especially in the areas around the Salford Quays waterfront, Media City, Regent Road, and Ordsall.

With average rental yields of 7.20% in M6, it’s certainly one of Greater Manchester’s best-performing areas for property investors. And with strong student numbers in this part of the city, it could be a more attractive entry point into the student market given the lower average property prices compared to Fallowfield and Oxford Road.

4. Hulme (M15)

Hulme is a large, primarily residential section of the inner-city that connects South Manchester with the centre of Manchester.

There’s a significant student presence in Hulme as it’s in a convenient location for accessing both the University of Manchester and Manchester Metropolitan University.

The postcode that covers Hulme, M15, runs right up to the edge of Oxford Road and even encompasses the Manchester Metropolitan University campus. Plus, with average rental yields of 6.9% and a growth of 20% in average property prices in M15 over the past five years, it’s clear Hulme and the surrounding areas (like Greenheys) generate exceptional value.

Despite that, it’s Hulme’s ongoing development and proximity to the city that make it an area with huge promise – not just for student housing, but the wider market. With cheaper rents than the city centre and plenty of flatshares, Hulme attracts scores of fresh grads in their first few years of post-Uni life – a very attractive tenancy market for investors.

5. Withington (M20)

Withington is Fallowfield’s slightly more grown-up older sibling.

Sitting just south of Fallowfield (they’re separated by Mauldeth Road), it’s another strong choice for student accommodation investment – particularly if you focus your search around the high street in the centre of Withington.

This is important to note because as you travel southwards, the M20 postcode that covers Withington quickly turns into the affluent and family-oriented Didsbury – including the lively Burton Road and Didsbury Village. This shows up in the data too, with M20 holding the highest average property prices on our list (£354,615).

Withington’s appeal lies in its diverse range of shops, cafes, and bars that cater to both the student population and local residents, creating a lively community-led vibe. The area is also known for its green spaces, such as the picturesque parks at Ladybarn and Fog Lane, and has excellent transport links to the universities and city centre.

PBSA vs HMOs in Manchester

Traditionally, the student experience has entailed living in university halls of residence in the first year, followed by several years of renting a privately owned flat or house with friends and coursemates – known as Houses of Multiple Occupancy (HMOs).

Student HMOs can range in size and quality but generally achieve exceptional yields as landlords let the individual rooms, although often with a central rental agreement or guarantors in place to protect their income if, for example, one tenant decides to leave.

The vast majority of student properties around Fallowfield, Oxford Road, Withington, etc, are HMOs – old Victorian and Edwardian houses with space for 5+ tenants, each with individual rooms but sharing common spaces, like a kitchen, living room, and bathroom.

A more modern alternative is Purpose Built Student Accommodation (PBSA). These are newer, multi-storey apartment blocks built solely for students. Tenants have private rooms in either a self-contained studio or with shared facilities – like first-year halls, but privately owned and operated.

So far, they’ve proved particularly popular with international students, who are willing to pay a higher premium for modern amenities.

Manchester has a critical undersupply of PBSA compared to other major university cities in the UK.

However, the city council accepts they need more PBSA to meet growing demand as student numbers increase, and to free up traditional housing for non-students (which would improve council tax income, as students are exempt).

In short, expect more PBSA projects to get off the ground in the next few years. And keep an eye on the areas around Oxford Road, as current council policy is for PBSA projects to centre around this area.

Summary

All in all, Manchester is a fantastic choice for student property investment.

It’s one of the UK’s leading educational hubs and that’s unlikely to change, with a thriving student population and a long history of academic success.

Property investors can, therefore, tap into a strong student tenancy market, with various areas of the city offering great value and returns. The urgent need for more PBSA is a big bonus too, with plenty of new schemes expected.

If you’re interested in student property and would like to discuss an investment strategy further, we can help. We specialise in buy-to-let property, both residential and student, and we specifically focus on markets like Birmingham, Liverpool and Manchester.

You can reach us by filling in the form below, and we’ll call you back to organise a free consultation.

About Our Data

The data in this article comes from properydata.co.uk and is accurate as of January 2024. We’ll update this report next year, in 2025, with the latest insights and fresh data.