JLL Residential

Leeds sales and lettings market comment

Leeds, 26 July 2017

This month, JLL’s Manchester and Leeds property specialists discuss their respective city centre markets, and the increased buying power and competitive returns available to investors looking north.

Read on for our take on the Leeds market or click here to read our overview of sales and lettings activity in Manchester.

Leeds sales
Leeds city centre sales market does not, so far, seem to have been affected by the UK’s decision to leave the European Union. Completions during the first half of 2017 were up 30% on the same period last year, with sales enquiries also rising 30%.

The snap general election in June and its shock outcome caused a brief hiatus in activity. Additionally, low levels of supply across Leeds and a lack of announcements concerning new developments are likely to lead to increased prices during the coming months. However, we are currently marketing two new developments outside of the city centre: Kirkstall Gate, in the Leeds suburb of Kirkstall, by Gold and Amber Developments, and Dawsons Square by RBH Properties, located in the market town of Pudsey. Throughout less central areas like these, competitive capital values and strong tenant demand are providing excellent returns.

The value of homes in Leeds lags behind those in other regional centres, such as York and Harrogate, but this means that Leeds is becoming increasingly attractive to UK and overseas investors. Rental yields of up to 8%, combined with real prospects for capital growth have set Leeds up as an enticing residential investment opportunity.

Leeds lettings
Leeds’ lettings market is currently buoyant, with demand from young professionals and an active student market currently driving values. Lack of stock remains an issue, however, with 2-bedroom properties with parking proving increasingly popular.

Our letting agents are predicting that rents in the city centre will increase by 22.2% over the period to 2021. This rise will be driven by a shortage of properties at first, but expect high-spec apartments in private rented community schemes to command a premium over older properties as these developments reach completion. Upcoming developments which match this profile include Monk Bridge by Foundation Real Estate and Moda’s scheme at Quarry Hill, which should break ground in early 2018.