Regeneration cities in England see strong rental growth and demand
The average rent in cities that have seen extensive regeneration has increased by 21% in the last five years, compared to just 16% across England as a whole, new research shows.
The biggest boost of the 12 cities examined was in Manchester with a 38% rise in rents since 2014. The report from letting platform Bunk points out that the relocation of the BBC and the regeneration of Salford Quays may be responsible.
Next was a 38% rent rise in Cambridge and it suggests that 200 new homes being built on a former depot site will attract even more people. This was followed by a 31% rise in Newcastle and a 29% rise in Bristol.
Other cities seeing regeneration work with significant rent rises include Portsmouth up 19%, Liverpool up 17%, Brighton and Oxford up 16% and Reading, Sheffield and Birmingham all up 15%, but the last three are below the national average in England of 16%.
The report suggests that while some may view the gentrification of an area in a negative light as it can drive up house prices and displace the local community who can no longer afford to live there, if rents are rising it does present an opportunity for landlords.
‘Regardless of your opinion on gentrification, one thing is clear. These transformations are positive in terms of the level and quality of housing stock being provided and there is certainly an appetite for these developments and for housing in areas to have seen drastic improvements,’ said tom Woollard, co-founder of Bunk.
‘For landlords this maintained demand pushes up prices and these areas provide a very good return on investment in a landscape that is currently rather tough. So for those looking to invest, the best option is to get in early to an area that has been earmarked for regeneration but is still affordable at present, and you should see a healthy return despite the changes to the sector of late,’ he added.