Leeds has long shed its image as just an industrial powerhouse and is now known for its financial and professional sectors, amongst others. In fact, Leeds is one of three cities (the others being Manchester and London) where there are more private sector jobs than the national average. It has even gone as far as winning awards including being named ‘Britain’s Best City for Business’.
In figures, all together the local area’s economy is worth around £55 billion with expectations of 12.4% growth over the next five years. Plus, 2014 saw the introduction of the £1 billion Local Growth Deal, an initiative designed to create jobs and accelerate economic growth.
The success of different businesses and the promises of growth are also having the secondary benefit of attracting more and more people to the city. Leeds’ population has grown by approximately 5% over the past ten years, a figure which is expected to soar even further. By 2020 it is estimated that there will be an 8.7% increase to the city’s population and by 2035 this will jump to 20.3%. Of this, 467,000 were in employment this year, finally surpassing a pre-recession peak and proving the city has long moved past the financial troubles of the past decade.
Alongside impressive tales of regeneration, its reputation as being a vibrant, cultural city, and consistently being voted a student favourite, it would appear that Leeds has it all in its favour. However, with such a sudden interest in the city, its housing market has simply not been able to keep up.
Like many cities around the country, Leeds has felt the demand for new homes to be built. The National Housing Federation estimated that Leeds needs 4500 new homes every year to keep up with this rising demand, however, last year only 950 were built. This problem is only accentuated in the city centre where rental properties are exceedingly popular. Earlier this year, lettings agency Morgans reported that for every one rental property they put on the market, three or four people are interested.
Jonathon Morgan, Managing Director of the firm, commented “often homes that are finished to a high standard and in a good location will let in less than a day due to the shortage of high quality apartments across the city centre.”
It is no surprise then that Leeds is gaining the interest of Buy-to-Let investors. The strong popularity and lack of supply, means that void periods are likely to be shorter and more infrequent as tenants don’t want to leave. Plus, when looking at the returns Leeds offers, not only does it have gross yields of approximately 8%, but also (as part of the Yorkshire and Humberside region) Leeds has seen increasing rental values over the last ten months.
One of the city’s most highly anticipated investment opportunities is X1 Aire. The perfect development for any Buy-to-Let portfolio, this large residential scheme offers savvy investors the chance to capitalise on this bustling city. Plus, with a fully equipped gymnasium and onsite management by award winning X1 Lettings, X1 Aire will also be in high demand with tenants.
X1 Aire is located on the edge of the city centre, next to the River Aire, meaning residents are close enough to walk into the heart of the action, but they also have a peaceful retreat away from the noise of the city at the end of the day. The development also benefits from being located close to a bus station and train station for ease of access.
Altogether, Leeds offers investors the unique opportunity of accessing a market about to boom. This has been highlighted in the JLL report on ‘New Beginnings in the North’ which noted how: “The Northern England sales and lettings market look to be in better shape than for several years and, with Manchester and Leeds leading the way, we believe we are entering new beginnings for these residential markets.”