Liverpool’s Property Market Sees Rush of Private Investment
With the increasing strength of the UK’s Northern Powerhouse, Liverpool’s residential property market is experiencing a steep increase in private investment.
A big part of Liverpool’s continued strength comes from its attractiveness to high net worth investors looking to invest their capital in property for longer periods of time and reap the long-term rewards. This means larger funds are remaining in the city for longer, providing a significant long-term boost to the economy.
In the first quarter of 2016, property investment activity in Liverpool received an enormous boost from investors rushing to beat the Chancellor’s increase in stamp duty. Major development regions like the Baltic Triangle area are also helping to drive up sales in the city. Over the past two decades the city has seen numerous multi-million pound regeneration projects; significantly contributing to Liverpool’s massive economic expansion.
It is easy to see the appeal of investment property in Liverpool; the market is performing well and is predicted to continue growing as long as the northern powerhouse initiative continues. According to the City Residential's Q1 2016 report, Liverpool’s property prices saw a quarterly rise of 1.24%; with this being a year-on-year increase of 3.98%. Letting prices saw a similar increase, with a quarterly increase of 0.99% and annual growth of 3.46%.
The City Residential report highlights strength to the letting market extending far beyond simple price growth. Liverpool’s severe undersupply of property stock, combined with the city’s continually expanding population has led to a serious imbalance in rates of supply and demand; which only serves to continue price increases in the region. New developments being built throughout the city offer investors a brilliant opportunity to take advantage of this supply-demand imbalance, but are insufficient in number to make a significant contribution to the stock shortage.
Furthermore, from a behavioural standpoint, the report also claims that tenants in Liverpool are generally more likely to stay in rental accommodation for longer periods of time. This makes tenancy more secure and rental returns more stable than in many other markets; and contributes to developers’ growing ability to offer assured rental returns.
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