The Northern Powerhouse: four years on

In 2014, then Chancellor of the Exchequer, George Osborne, stood in Manchester’s Museum of Science and Industry and announced the need for a “Northern Powerhouse”. He revealed his plan to create an amalgamated economy of the cities of the North of England, which have a combined population of 15 million, in order to compete with the biggest economic hubs of Europe.

The Northern Powerhouse: four years on

London, Frankfurt, Paris, and others have long been regarded as the economic powerhouses of European finance, manufacturing and services, but under the Northern Powerhouse plans he would provide funding and incentives for the best and brightest in business across the north to work together to challenge the monopoly.

It was feasible, he said, to provide huge investment into infrastructure to connect the cities of Manchester, Leeds, Liverpool, Hull, Sheffield and Newcastle in order to make a type of “megacity” that would allow co-operation between them all in what would effectively be a single economic region.

The announcement caused great excitement across the region, with many pointing out that the vast majority of infrastructure spending from central government was spent in the capital rather than spread across the country – the Northern Powerhouse stood to change this. But how are things getting on four years down the line?

By and large, the economies of the north are thriving. Gross Value Added (GVA) has been increasing across the board annually, and job creation has steadily increased. Perhaps the biggest change in this time has been in property, though, with house prices, yields and capital gains in domestic and off-plan property increasing almost exponentially and in great contrast to certain areas of inner-London and the south east.

Manchester, Leeds and Sheffield have some of the quickest rising house prices in the UK and with the three of them boasting world class educational facilities they’re also seeing a big increase in innovative young professionals choosing to settle in the region.

Housing and transport seem to be a key focus of the government in its investments into the Northern Powerhouse, with BuyAssosiation reporting that government is using its Land Release Fund to invest £8.9m in the north of England to support the construction of more than 2,000 new homes in a bid to try and tackle the housing shortage.

Further to this, the net seems to be getting cast as wide as possible, with Newcastle Airport now signing up to be a partner of the Northern Powerhouse. Air travel is one focus of transport, with Manchester’s Airport City hopefully providing a huge gateway to the Far East and China with particular focus on business relationships.

Devolved political powers have increased somewhat too, with Manchester, Liverpool and Sheffield all getting their own elected metro mayors who have new powers in terms of spending and planning.

There is always a fear that the same old suspects will get the lion’s share of the investment, with Manchester’s Piccadilly train station set to receive a multi-million pound renovation to accommodate the HS2 railway developments, but little in the way of concrete plans for the likes of Hull.

Ultimately the government seem to be coming good on their promises to provide funding for infrastructure improvements to make a singular entity in the interest of economic development. Certainly the jewels in the crown of the project, Manchester, Liverpool and Leeds are thriving.

Creative industries in business, new jobs and property are all at the top of the list when it comes to indications that good times are coming, and it seems that exciting times are certainly on the horizon for the north.

If you’re interested in learning more about investing in the north’s booming property market, contact us today to find out more!

UK BTL vertical - April 2019

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