We take a look at the effects Brexit has had on Manchester City Centre, in particular how many people have moved to the city over the past year and the number of schemes under construction in the city centre.
Peter Scully | 11th November 2019
As the old saying goes “a rising tide floats all boats”, unfortunately, the flip side of this is that stormy waters cause problems for all boats, although not necessarily to the same extent.
Manchester, for example, is arguably in a fairly good position to weather whatever Brexit will bring, due to its diverse economy and global trading links. Even so, it’s starting to feel the pinch slightly as evidenced by the slowdown in construction, especially in the city centre.
Manchester needs affordable homes, but Brexit is increasing the costs of construction
In the old days, leaving Manchester for the bright lights of London was almost a rite of passage for young adults. These days, it’s quite the opposite.
Not only are young people staying put in Manchester (or returning to it after studying elsewhere), but they are being joined by young people from other parts of the UK, especially London.
The main reason for this is that Manchester has developed the reputation of being a place where residents can have both great employment opportunities and a great lifestyle, including (and possibly most especially) the chance for the average person to buy a high-quality home at a price they can actually afford.
Local authorities in Manchester are very well aware that the continued growth of their city depends on the availability of high-quality, affordable, housing and are doing their best to provide it but Brexit is making their life difficult by increasing the costs of construction.
It’s common knowledge that the construction industry in the UK benefited hugely from the availability of EU workers, especially skilled tradespeople.
Some of these workers have now left the country and one of the factors motivating their decision to leave was probably the fact that the result of the referendum sent the Pound on a downward tumble from which it has yet to recover completely.
The reduced value of the Pound means that EU workers who remain in the UK can send less money back to their home country, which, in some cases, may be a significant issue for them.
It also increases the costs of importing raw materials and supplies from other countries into the UK, which can impact whether or not developers choose to proceed with projects and hence the amount of work there is available.
This can also influence EU workers to head to places where the construction industry is moving at a brisker pace.
The silver lining to this cloud is that the Brexit slowdown offers international investors a great opportunity to buy into the Manchester property market at effective prices they may never see again.
In fact, international investors from certain countries may be able to buy at a 27% discount to UK-based investors who work in Sterling.
The continued activity in the city centre property market shows that this has definitely not gone unnoticed and also clearly demonstrates that “Brexit issues” are being viewed as short-term challenges rather than as long-term problems which could significantly impact the city’s economic robustness.