Leeds continuing to show strong growth

Last year was a good one for Leeds. Ever since the former Chancellor of the Exchequer, George Osborne, announced plans for the Northern Powerhouse project in 2014, investment has been increasing in the Yorkshire city.

Leeds continuing to show strong growth

Not that it wasn’t already, of course; with two world class universities and a booming economy, Leeds has long been leading the way for cities seeking to expand their economy and improve their environments. Focussing on new and emerging industries as well as providing financial support to their educational institutions has paid off for the Yorkshire city region with impressive results.

According to Leeds City Council, Leeds is the UK’s fastest growing city and is the main driver of a city region with a £64.6bn economy, a combined population of three million and a workforce of 1.37 million. Over the next 10 years the economy is forecast to grow by 21%, with financial and business services set to generate over half of Gross Value Added (GVA) growth over that period.

Digging a little further into the figures, the economy is fairly diverse. In 2016, Leeds saw the fastest rate of private sector jobs growth of any UK city and has the highest ratio of public to private sector jobs of all the UK’s Core Cities. The city has the third largest jobs total by local authority area with 480,000 in employment and self-employment at the beginning of 2015 according to the Leeds City Council website.

How are things going so far in 2017? The city economy of Leeds is on course to be £184m larger by the end of 2017 than it was in the three months after the EU referendum result according to a new study by law firm Irwin Mitchell.

In their Powerhouse City Growth Survey in July, Irwin Mitchell placed Leeds in the top 20 performing cities in the UK for GVA, with a 2.1% increase in Q1 of the year.

The city area also saw employment grow by 1.3%, with a total of 433,738 new jobs. This, again, sees Leeds occupy a place in the top 20 cities in the UK along with Manchester and London.

Perhaps most impressively, Leeds occupies second spot, behind London, for the ‘financial powerhouse’ measurement. Leeds financial sector grew by £177m in the three years from 2012, with a 10% total increase. The share of the city’s total GVA for financial services now sits at 12%, only slightly lower than London.

Over the same period, Leeds sits second behind London for employment growth in banking, finance and insurance. The industry in the city created 21,300 in three years, meaning that as of 2016 a total of 94,300 people now work in the sector in Leeds.

The report notes: “Leeds has expanded its financial sector substantially in recent years, placing second only to London in terms of both GVA and employment growth. In fact, the city’s total output from finance and insurance increased 40% from 2012 to 2015. The Yorkshire city is home to the headquarters of three of the five largest building societies and 30 national and international banks.”

The city is growing impressively in terms of jobs created and overall economic value.

The Guardian recently reported that the Leeds property market is following this trend, stating that it is among some of the UK’s best cities for housing affordability. Demand for property across the region is higher than most.

Research from Yorkshire Building Society says that since 2007 houses in Leeds have become roughly 10% more affordable than they were a decade ago. It indicates that whilst property prices are increasing, so are wages in the area and living standards. This translates into a situation where more people are able to afford housing that is increasing in value.

What of price growth though? The Yorkshire Post recently reported that House prices in Leeds will rise by two-thirds in the next 10 years. The price of an average property in Leeds in 2027 will be £291,845, compared with £174,401 today, according to research by Emoov.

A recent survey released by Savills on the economic future of Leeds predicts that rents are set to rise by 13.5% in the next five years, comparing well with other fast-growing areas of the UK.

All in all Leeds had an excellent 2016 and the first six months of 2017 were also very impressive. As we draw closer to 2018 the city is showing no signs of slowing down with job creation, wealth and house prices all increasing.

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