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Leeds

Leeds set to see first residential cranes for five years as developers return to the city

Oversupply of city centre apartments now a distant memory


Leeds, 19 March 2015 - The Leeds city centre residential development market has been dormant for many years but, with construction of at least one new housing scheme on the horizon this year, property agency JLL is forecasting a marketplace which is beginning to waken from its slumber.

According to JLL, 2015 could be the year when the Leeds city centre residential development market re-ignites.  The majority of existing stock is now over six years old however Calls Wharf is anticipated to obtain planning consent  imminently, with an anticipated start on site later in the year, and a couple of others schemes on the radar will foster heightened activity in the sales and lettings market.

"Leeds has historically been the focus of media attention surrounding the oversupply of apartments in the city centre. But with occupancy rates in excess of 98%, this is now a distant memory. We are faced with significant demand for quality, well located properties, for both sales and lettings and we urgently need new development to satisfy the ever increasing demand", says Guy Ackernley, head of residential at JLL in Leeds

JLL also anticipates that 2015 will see the first significant Private Rented Scheme (PRS) in Leeds city centre.  This much heralded build to rent model has to date largely concentrated on the London and South East with regional deals most recently announced in Manchester and Liverpool.  JLL argues that the viability for PRS for institutional investors has been assisted by 7% rental growth witnessed in Leeds last year and it is likely the first deal to be agreed on a prime city centre site would be for around 200-400 units.

Guy concluded: "The Leeds residential market is seeing the first signs of genuine momentum since the downturn. This is leading to a range of industry activity, notably through the nascent stages of the local build-to-rent market, which has the potential to drive the next phase of urban renaissance in Leeds. Just as the student housing sector took off in the UK nearly ten years ago PRS is very much a part of the alternative asset classes which institutional investors are now considering."

2015 will be a year of stable, above inflation price growth in the Leeds city centre market. JLL forecasts that the city will see house price rises of 4% this year with increases of 3-5% pa over the following four years.  In the city centre rental market, JLL forecasts growth of up to 5% pa over the next two years.