Meanwhile, on the outskirts of Manchester's city centre, some of the smaller towns with direct tram-links to the city have been quietly but successfully improving themselves and are now competing directly with the city itself on price and rental income.

Which is good news for me. Cheers, Tony!

Hi Tony

Did you know there was a great EU sponsored report on cities of the EU?

This categorised cities into

Knowledge hubs (eg Cambridge, Barcelona and Krakow)
Logistic hubs (eg Lodz)

etc...

Did you see any similar research on the UK?

ie. Are the UK's most promising cities those that are of a certain type? Such as Knowledge Hubs?

If so, this would help us spot other promising cities in the UK.

Cheers
Neil

Of course, the trouble with such comparisons is that they always rely on the accuracy of the data. I simply do not believe that 47% of Tower Hamlets working age residents are not in employment. They may be claiming job-seekers allowance or the like, but "not in employment" is not the same thing.

That being said, the research seems to throw considerable doubt on the core belief of the researchers - that cities are the main sources of wealth creation and innovation. Many of the places that score best with them are not really cities but large towns. They rather underline the belief that "small is beautiful." The larger cities attract and create large masses of the under-educated and unenterprising which create social networks which reinforce those attitudes. Add to that a government system which still pays people to not work and these results are not surprising at all.

It would be very interesting to be able to judge what, if any, effect the recent mass immigration from eastern Europe has had in different areas. Is there any correlation between their arrivals and increasing or decreasing prosperity?

For buy-to-let investors the lessons are not clear at all. For places like Oxford, Cambridge, Milton Keynes, and Reading (all university locations) strong property prices can be relied upon, but that can mean that the purchase price-to-rents proportions are all wrong. The biggest question for us is, "Would the rent cover the mortgage interest?" (and that should assume a theoretical 100% mortgage) It would be very useful indeed if Property Secrets could uncover or instigate research that shows these proportions in different towns and cities.

I suspect that some of the large and poor city area might show up better in such statistics,

There is another important principle though - both the purchasing and the management of properties are best organized within an area close to the buyer's home. I believe that the principle of proximity is one that is wrongly omitted from most discussions on the buy-to-let market.

Sorry, but technical gremlins have prevented me from replying until now. Ben, I have actually just moved from Manchester, where I lived for 25 years, so I know the city very well. I agree, many of the surrounding towns have benefited from Manchester’s regeneration and Metrolink routes have done particularly well. Rental income has not faired quite so well though, largely due to an explosion of comparable new build apartments. Rents have in fact stagnated, though property prices have increased.

Neil, I wasn’t aware of the EU sponsored report, but I will look it up as soon as I have some time. I haven’t seen similar research for the UK. The Centre for Cities isn’t based purely on a single type, as far as I know, but a cross-section of elements. Their research doesn’t say which came first, particular cities that were then further explored … or data that identified specific cities. I suspect the latter, as much of the data refers to economic growth and expansion. It’s a bit ‘chicken or the egg’, I guess. I am sure you will agree that these days it is actually quite difficult to identify truly independent and unbiased surveys and reports, as many are ‘supported’ by an agency or group whose intentions are to highlight particular aspects that are important to them and play down any disparaging elements. There is so much manipulation of stats these days – everyone’s a spin-doctor. Ha.

Webranger, you are quite right, the data can only be considered an indicator of what is happening – rather than an absolute certainty. It is also fairly easy to pick holes in this type of survey, without necessarily appreciating their usefulness. Mass immigration is certainly playing a key-role in some cities and, yes, early research suggests there IS a direct link between increasing rent levels and lower voids where a large volume of Eastern Europeans have settled. Regarding Tower hamlets, even if the figure is not entirely accurate, presumably the same identifying criteria was used for all towns and cities – so it is still useful data. I think the main point is that even if people are working while in receipt of benefit or allowances or on whatever training programme exists at the time, they represent a section of that town’s population that is struggling, financially.

Your final point about investing close to where you live is an important one – and anyone that has been reading my articles over the last year or so will be aware I personally believe it can be crucial in deciding where and what to invest in – as well as making the timing of selling of BTL units more pertinent. Knowledge is power and local knowledge is king. That said, if the local area is not fairing well in comparison to distant towns and cities, an investor could of course lose out by staying loyal to his own neighbourhood.

Tony B