Property Price Surge! Birmingham and Manchester Outperform Everywhere Except Hong Kong and Sydney As London Slips

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Sydney Opera House

A unique analysis of property prices shows that Birmingham and Manchester grew faster than all the major world cities in 2017, except Hong Kong and Sydney.

Prices of commercial real estate in Birmingham, Bristol, Edinburgh, Glasgow, Leeds and Manchester rose almost 20% in Q4 from a year earlier according to Real Capital Analytics’ Commercial Property Price Indices. This placed the Big Six U.K. cities just behind Sydney and Hong Kong in a ranking of the world’s fastest growing markets.

"Prices have surged in the U.K.’s largest regional commercial property markets and the national industrial sector in the last 12 months, just as the London market stalls after a lengthy bull run and a sharp drop in institutional investor interest," Real Capital Analytics Senior Director of EMEA Tom Leahy said.

Cross-border investment in the U.K. Big Six increased by 10% in the last year, with average yields falling by around 40 basis points over the same period. However, prices in the Big Six remain 14% below their previous peak, Leahy said.

"There is a perception that the regional markets could be less affected than London by a disorderly or unfavourable Brexit deal," he said.

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