Research at JLL

Northern England Residential Forecasts – February 2017

Northern England’s main cities are beginning to thrive again. Manchester, the UK’s second city, is flourishing amid strong housing demand and significant development activity and is becoming increasingly global. Leeds and Liverpool are also now looking forward with greater confidence. The region will benefit further from the Government’s Northern Powerhouse programme.

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Rhetoric and sentiment will undoubtedly fluctuate en route to Brexit but there have been encouraging economic signs since the vote last June. These suggest that UK and regional economies have been more resilient, less vulnerable and indeed more positive since the referendum.

However, most economic forecasts are still predicting a shallower economic growth and employment growth profile than would otherwise have been the case. This said, economic growth across Northern England is projected to be 1.5% pa between 2017 and 2021. The highest rate of growth is forecast to be in the financial & business services sector which is expected to expand by 2.4% pa during this time.

The Manchester city centre residential market has been one of the UK’s leading markets for price and rental growth for several years now, and that looks set to continue. This has led to a considerable increase in development activity. Until this new supply is completed, residential demand will outweigh available supply, creating pressures within the sales and lettings markets.

Leeds has a significant amount of pent up demand for city centre residential property and there has also been strong demand for development land – a strong sign of confidence in the city. Now is the time for new schemes to come forward.

Liverpool is a rapidly transforming city with major regeneration activity taking place, particularly in the docklands. The city is now firmly at the top of many investor’s hit lists and looks set to outperform other regional cities in terms of price and rental growth.

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