This roughly aligns with projections for 2020 from the estate agency Savills for growth of 3 per cent in the Midlands, 2 per cent in the north of England, Scotland and Wales, 0.25 per cent in the south and a fall of 2 per cent in London.
Gavin Brazg, the founder of the Advisory, a property consultancy, says that the cities with the highest demand — Glasgow, Bristol, Sheffield, Salisbury, Coventry, Nottingham, Edinburgh, Leeds, York, Manchester, Liverpool, Birmingham and Brighton & Hove — will have “the strongest capital growth in the medium term”
IP Global, a Hong-Kong based property investment company, said that the most desirable markets for investors in 2020 would be Manchester, Leeds, Birmingham, Liverpool, Sheffield, Edinburgh and Glasgow.
Most people who move house are not investing but buying somewhere to live; nonetheless it can pay to be aware of the areas that offer value for money and potential for future gains — and rental opportunities. We take a look at the UK markets likely to fit that bill this year.
Northern England
The prime minister, Boris Johnson, has pledged to spend billions of pounds on infrastructure in the north of England, with Manchester, Liverpool, Sheffield, Leeds and Nottingham all tipped to benefit from his largesse.
Savills predicts that property in the North West will go up the most over the next five years, with price growth of 2.5 per cent this year, rising to 6.5 per cent in 2021. Lucian Cook, the head of residential research for Savills, says: “The North West is forecast for 24 per cent growth from 2020 to 2024, reflecting the strength and diversity of the economy and the capacity for higher loan-to-income borrowing. It will be followed by Yorkshire and the Humber.”
Crispin Harris of the estate agency Jackson-Stops, says: “Manchester has a massive buzz about it and a lot of foreign money being invested. It has fantastic transport and is two hours to London, if you want to go, but why would you? Manchester is a fun place to be.”
Harris picks Didsbury and Chorlton, as up-and-coming suburbs with appeal to professionals and families. “They are becoming fashionable, trendy areas with a young vibe and are far more affordable than the next ring of suburbs out.”
The Midlands
Birmingham, known as the Midlands Engine, is forecast for 18.2 per cent house price growth in the next 5 years, with rent rises of just over 19 per cent.
Isaac Burner from Savills tips the Jewellery Quarter and Digbeth, a neighbourhood near the city centre, as places to watch. “Digbeth is the once-edgy district that is fast becoming the new creative quarter. A young crowd, art galleries, markets and bustling pubs, five minutes to the proposed HS2 station and 15 minutes to New Street station mean it is fast becoming an attractive location.”
South East
The proposed Oxford-Cambridge Arc will join the two university towns via new rail and road links, with about a million new homes to be built between the two. “The greatest potential for [housing] delivery is the middle of the arc, where land is less constrained,” says Richard Janes, Savills’ head of development in Cambridge.
“Areas like Milton Keynes and Bedford already have the highest forecast growth — they are also the more affordable markets.”
Farther to the east, Norwich has had a 37 per cent growth in house prices in the past five years with a further 14 per cent predicted in the coming five years. Richard Aldous from Savills in Norwich says: “The area between the A11 and A47 to the west of the city is full of pretty terraced houses around the old Norfolk and Norwich hospital. It’s a prime bit of city, but still has room for growth.”
Other areas to watch include Canary Quay, Duke Street, St Benedicts Street and the Anglia Square scheme outside the ring road, according to Aldous.
Commuter belt
Luton, in Bedfordshire, is slap-bang in the middle of the so-called Cambridge-London-Oxford triangle, and is attracting investors who see potential for growth thanks to the town’s £1.5 billion regeneration programme.
Santhosh Gowda, the chairman of Strawberry Star Group, a developer that is building Lu2on — a hotel and 877 flats near Luton Airport Parkway station — has sold property to several buy-to-let investors. “As one of the ten best buy-to-let areas in England, we are predicting that Luton’s rental yield will grow at 6 per cent over the next three years, significantly higher than much of London,” he says.
Slough, in Berkshire, another formerly derided town (the poet John Betjeman called for “friendly bombs” to fall on it) is tipped for regeneration. Berkeley is building 1,300 homes at the former Horlicks factory and Muse developments is leading the £650 million North West Quadrant project to regenerate the Thames Valley University site from 2021.
There are plans too for a fast rail link between Slough and Heathrow.
London
House-price growth has lagged behind the rest of the UK for more than a year and 2020 promises to be no exception, although sales in prime central areas are tipped to pick up now that the threat of a Jeremy Corbyn-led Labour government has dissipated.
The Knight Frank estate agency forecasts that prices in prime neighbourhoods will rise 18 per cent over the next five years and by 13 per cent in prime outer London. One of the most promising prime areas is Bayswater, in central London, where a large regeneration programme is underway. Samuel McArdle, the director of Sterling Private Office, a buying agency, says: “Prices in the area have never achieved the heights seen in nearby Notting Hill and Marylebone — blighted by a lack of amenities and community feel.
“However, with several high-profile developments underway, we have seen interest growing steadily as investors look to capitalise. Prices are expected to climb dramatically over five to ten years.”
There are still pockets of value outside of prime London, with areas such as Brentford undergoing regeneration. Priya Black, the head of new home sales in Knight Frank’s Baker Street office, says: “Homes in Brentford typically sell for less than the neighbouring towns of Chiswick, Barnes and Richmond upon Thames and average sales prices in TW8 in the past 12 months were the lowest of any riverside postcode in west London.”
Parts of east London also represent value for money. Marc Schneiderman, the director of Arlington Residential estate agency, says that Whitechapel is the place to buy in 2020. “With the new Elizabeth Line station being constructed, it is an area to watch. Near Brick Lane and half an hour from Marble Arch, it has its own vibrant community and is in my view overlooked.”
Scotland
Savills expects property prices to rise 19.9 per cent in Scotland over the next five years. JLL, the US real estate company, has said that by 2023 prices will have risen 16.5 per cent in Edinburgh and 13.7 per cent in Glasgow. Edward Douglas-Home, the head of Knight Frank’s Edinburgh office, suggests that east of New Town — in particular the streets off Leith Walk — will be boosted by the redevelopment of the St James Centre. The tram line also looks set to be extended down Leith Walk, which will bring investment and gentrification.
In Glasgow, John Boyle, the director of research at Rettie estate agents, says: “Broadly I’d say core West End, city centre and Merchant City are best placed for rent and capital growth. They are already strong, but will benefit from a council strategy for more residences.”
Wales
House prices in Wales outperformed the rest of the UK last year, according to research by Nationwide building society. Savills expects this to continue with “relatively strong growth over the next five years” of 18 per cent. The strongest areas are in the south around Cardiff.
Caroline Vanner from Savills Cardiff says the city centre, “around the new station, is the most recent regeneration area, including the development of Central Square. There are also lots in the pipeline, including the redevelopment of the old Howells department store.
“The Dumballs Road area is a huge investment opportunity with planning permission for 2,000 homes, so although early there’s a buzz starting around the area.”
She adds: “Five minutes from the city centre is Pontcanna, a leafy suburb with a great vibe. Definitely ‘one to watch’.”
Source The Times.
