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News Release

Leeds

Government measures help trigger Leeds city centre housing revival

Latest research from Jones Lang LaSalle says residential activity is ready to take-off


Leeds, 20 November 2013 – Property consultant Jones Lang LaSalle has
published its latest Residential Eye: Northern England Residential and Development Market report which shows the Leeds city centre sales and lettings market has seen a significant upturn over the course of this year.

 

Highlights from the report include:
•         Sales in the city have doubled in first half of 2013, with enquiries up by 50 per cent
•         City centre lettings market continues to flourish with demand strong and a chronic shortage of available stock becoming a major issue
•         Saxton remains Leeds’ only new build development on the market, with Marshall CDP submitting planning for a mixed-use scheme containing 77 apartments on the Calls Wharf site, and Taylor Wimpey submitting a revised application on the Green Bank site
•         Yields stand at 6.5 per cent, with an average one bed flat costing £110,000 and renting at £575 per month and an average two bed costing £140,000 and renting at £750.
 
The volume of residential transactions have more than doubled in Leeds according to Jones Lang LaSalle’s latest report. It attributes the impact of the Government’s stimulus measures such as Help to Buy and the Funding for Lending Scheme together with an increase in buy to let and parent purchasers as helping to significantly improved the sales market.
 
Guy Ackernley, head of residential in Jones Lang LaSalle’s Leeds office, said: “Heightened sales activity and two new planning applications suggest better times ahead.
 
“Parents have become active participants, buying both in their own right on behalf of their children but also in helping off-spring with deposits. Investors have also made a significant return, perceiving now as a good time to buy on the assumption that values have bottomed-out and positive price growth is just around the corner.”
 
Guy continued: “The market perception for a number of years has been that Leeds was suffering from an oversupply; however the reality is that a lack of new stock is proving to be an issue for would-be buyers in the city centre. With many units locked into the rentals market and with no new development starts in recent years there is now a chronic shortage of apartments to let and buy.”
Jones Lang LaSalle estimates that more than 43,000 new homes must be built in northern England every year to keep pace with demand, though just half this level is currently being completed.
 
The highest number of additional homes needed is in Yorkshire and the Humber, with Jones Lang LaSalle forecasting that 18,000 new homes are required every year, shortly followed by the North West with 17,500.
 
Guy concluded: “The pent up demand for housing is significant and the biggest challenge for Leeds is to now encourage further development, to service the increasing demand and ensure that prices don’t become unaffordable.
 
“What’s interesting about today’s recovery is its lag in arrival from London. In previous recessions, places like Leeds have only been around nine months behind the capital, while in this cycle we’ve been closer to 15 months; this goes to show just how severe this past downturn has been.”