FIFTEEN of the 19 apartments released for sale in Paragon Mill in Ancoats last week sold before the day was out.
Investors want London – Manchester – Edinburgh, the rest of the UK does not exist
That’s roughly, very roughly because the reserved prices have now disappeared, £3.5m of property sold in eight hours. Not a bad day at the office for the developer, Leeds based Renaker Build and agents Jones Lang la Salle.
Which means that:
A: The properties in Paragon Mill must be mighty fine. True.
B: There are a lot of people with a lot of money wanting to invest in Manchester. Also true.
C: There’s precious little choice around for anyone wanting to buy to live. Mostly true.
Which means that anything half decent is being snapped up - show us your money and don’t ask for a discount.
If you want to buy a brand new place in Manchester right now here’s your choice:
20 still to be released in Paragon.
2 left in its sister Royal Mill next door
2 apartments and 3 houses left at The Point just down the road
4 at Cypress Place in The Green Quarter
11 in Block B at Alto, which strictly is Salford, but we’ll let it in.
Er...that's just about it.
Paragon Mill, Jersey Street, Manchester
There is some ex-rental stock being released at The Hub and Milliners Wharf and a handful at Spectrum, but if you want squeaky clean, first person to use the shower, brand new, you have just 39 apartments to choose from.
Louise Emmott, associate director with Jones Lang La Salle said: “We have seen a shift in the last six months with people who have been renting in the city looking to buy but there is not much out there.
“I never thought Manchester would get to this situation but if you want to move into something brand new now, or in the next three months, you do not have much choice.
“People are confident at the moment, can get access to mortgages and want to commit before prices rise and mortgage rates possibly go up.
“There will be other developments completing later this year but not much right now which is why developers can be firm on prices. There are no deals around. They don't need to offer them.”
North across the Northern Quarter to the hills
More frustratingly buyers are not just competing with each other they are competing with the investment funds. Which is an unfair contest.
1 Smithfield, a perfectly placed block in the Northern Quarter, was sold to a property fund at the beginning of the year. The 77 apartments here, one, two and three beds would have gone to private buyers all day long but a done deal 12 months ahead of completion was too tempting for the developer Muse which is also in the midst of building Islington Wharf Mews and Vimto Gardens in Salford.
The houses and apartments at The Point in New Islington offered a realistically priced option for people looking to buy and in three months only two houses and three apartments are left in the first phase.
Bit of a surprise then that the other three blocks, 85 nicely sized apartments, have been sold to a property investor and will not now come to the market for private sale, only rent.
The Homes and Communities Agency under its Get Britain Building scheme put millions into both Smithfield and The Point and the deals mean it will get the money back, when they complete.
But that seems a little short sighted and begs the question of what sort of city is being created.
More new flats needed
Where are the new neighbourhoods where people put down roots and have a long term vested interested in the building, their surroundings, their community?
Where are people who want to live in Manchester supposed to invest if the only market being serviced is the rental one?
There is huge demand for high quality, affordable rental property and the HCA is about to announce funding for several Private Rental Schemes in Manchester.
But private buyers should not be sacrificed along the way.
Several developments are due to complete later this year.
The apartments and interesting houses of Islington Wharf Mews will be complete for May and 10 of the 46 have already sold off plan.
The rusty steel frame of Nuovo/Sarah Point is almost fully glazed now and should be complete by September, so too the Kennedy Building at Royal Mills.
And Block D at Alto should also be finished.
Meanwhile other developers are racing to get started.
Lend Lease is on site at Potato Wharf and sales here are due to start this March with completion the following March. Once done they will move back and finish off the last block at Green Quarter on the site of the current sales office. Expect prices at PW to be higher than the £150,000-£170,000 at Cypress.
There are signs that Dandara could be dusting down its plans for Chapel Wharf next to The Lowry which would make sense. It’s the perfect spot for some high end specification.
Royal Mill
Which is why the Co-op is cashing in on the mini boom selling one of the residential plots at NOMA which: “everyone is trying to get hold of” - no deals for developers either it would seem.
But all could be sold tomorrow to investment funds.
Steve Hogg, head of residential at JLL said: “Funds buying at 4% gross yield in London will get 7% yield here and we have not even started our capital growth yet. There is a huge amount of interest. Investors want London – Manchester – Edinburgh, the rest of the UK does not exist
“All the new blocks coming on over the next few years could be bought by funds.
“There was an oversupply when all the towers came out of the ground and the private rental sector did not exist but things have changed.”
City view
