Tuesday 15 February 2022
There are a few fundamentals to consider when searching for a property investment. These are what make a city great for property investment:
Investing in Liverpool helps experienced investors diversify their portfolio by buying property in an emerging market. The city also provides opportunities for new investors and homebuyers with less capital. The north-west as a whole is forecast to see house prices increase by 24% across the next five years, making Liverpool a very lucrative investment.
Liverpool is one of the UK’s most loved cities and boasts a rich cultural and historical heritage. From the Beatles to the Titanic, Liverpool has a rich cultural legacy and is internationally recognised as one of the UK’s most-loved cities. It has been over ten years since Liverpool was crowned the European Capital of Culture in 2008. Over this time, the Merseyside city has established itself as a popular tourist destination for UK and international visitors.
With two thirds of the UK living within a two-hour drive, Liverpool is one of the best-connected cities in the UK. Its excellent transport network provides easy access to all UK, European and international destinations.
Liverpool John Lennon Airport is just nine miles away from the city centre and connects to all UK and European destinations while the nearby Manchester Airport serves all major international routes. The main rail station, Liverpool Lime Street, provides excellent links to the rest of the UK, getting you to London in just over two hours and Manchester in just 47 minutes.
Over the next few years Liverpool’s council are spending more than £300m on the road network, to make the city a better place to live, work and visit. The ‘Better Roads’ initiative, are actively improving key routes, that are in poor condition and carry large volumes of traffic. Over £100m has already been spent in the first 3 years of the project, which goes to show how proactive the area is in elevating and improving infrastructure.
An economy unique to Liverpool, is cruise tourism, which welcomed more than 60 vessels, with 120,000 passengers and crew in 2019. In order to capitalise on this niche, a £70m cruise terminal with facilities, located in the £5bn Liverpool waters developments, will be built. This will see the construction of a new terminal, on a new suspended deck structure in the Mersey. New passenger and baggage facilities, complete with passport control, lounge, café & toilets will be developed, improving the cities connectivity even more through this unique facet.
Liverpool is undergoing a £14bn regeneration led renaissance. This £14bn is being spent across a range of sectors to provide a holistic regeneration of the area. The largest of the initiatives is the £5.5bn waterfront regeneration, covering 15,000 hectares, forming 5 neighbourhoods, and providing a place to live, work and play. Work is already underway and is set to be complete within the next 30 years. Below are just a few initiatives, that are or will be located within this area, as well as within a new creative district and world-leading knowledge sector.
The Knowledge Quarter brings together partners across life sciences, innovation, and higher education. Since 2017, there has been significant investment into this area, with a clear vision towards promoting innovation and investment, into Liverpool’s student and research sector. In total £2.2bn is set to be invested in this area, by the time of completion in 2027. Knowledge Quarter comprises of three key investment opportunities. Paddington Village, Knowledge Quarter Gateway and Liverpool Health Campus – Please see website for further details: https://www.kqliverpool.co.uk/
Liverpool also believes in investing into smaller, more localised initiatives. To provide this holistic regeneration of the city, everywhere needs to be elevated and a good example of this is the £39m redevelopment of Lime Street, between 2016 and 2018. Keeping momentum going is seen as integral to continuous progression. As a result, in February 2020 the city council also endorsed a masterplan for the Upper Central area (around Lime Street), with a view to developing this 56-acre gateway to the city’s Knowledge Quarter, with the potential to create 7,000 new jobs.
Another area of Liverpool that is vital for the local economy, is the football industry. With both Liverpool and Everton in the city, this attracts global tourism and vast amounts of investment into the area. Liverpool recognises its importance, a reason why Everton’s new £500m, 52,000-capacity stadium on the Liverpool waterfront, broke ground at the start of 2021. Everton forecast that the project will offer a boost of more than £1bn to the city region’s economy, attract 1.4m visitors to the region each year and deliver an additional £237m of social value.
Liverpool sits at the centre of a regional population of 1.5 million people, who drive a regional economy worth approximately £30bn. The city has a young, growing population and is an incredibly attractive business destination, particularly in the finance, manufacturing, digital and creative sectors. A third of the workforce is currently aged 16-19 and a fifth in their 20s. These are the people who are creating businesses which are pushing economic growth onwards in the city.
With all the regeneration discussed above, naturally comes vast opportunity for employment in the area. By creating an innovative hub for research and creation, the cycle is self-perpetual, driving further advancement and drawing in more people. Plans to redevelop the old Littlewoods building into a new media facility and the further development of Lime Street will see the creation of over 10,000 jobs alone.
Furthermore, with extensive investment into the student population in and around Liverpool, there is no shortage of future workforce and innovative workers. This student population is vital to every city, as it stimulates and introduces new ideas and economic growth, a key player in stimulating capital growth in properties.
When the fundamentals above culminate into one, this results in an increase in demand for the area and its resources. As it creates opportunity, more people want to move into the area to capitalise on this. Liverpool’s city centre population is growing at record pace and with five world-class universities, billion-pound private investment projects and the largest number of start-up businesses in the UK, this buoyant city has emerged as a hotspot for property investors.
Although the city centre population has grown at a faster pace than any other UK town or city, the amount of people living in Liverpool has increased faster than the number of new homes being built. Locations with large student populations often perform well for landlords and with over 70,000 students, Liverpool is home to one of the country’s biggest markets. Over 66% of properties in Liverpool are privately rented with 50% of all properties occupied by young professionals. Liverpool has a flourishing property market and is widely considered as a UK buy-to-let property hotspot. There are some exciting opportunities waiting to be seized. The need for desirable living space in popular, convenient locations means high occupancy levels, a low risk of void periods and a strong likelihood.
The latest house price index from property portal Zoopla shows Liverpool making headlines again for this biggest house price rises. It saw a jump of +9.8% between September 2020 and September 2021. Average house prices in the city remain low, though, at £137,600, suggesting that it is still in early stages in terms of growth. When compared to the national average of £256,405 (UK House Price Index), Liverpool property is cheap in comparison and offers buy to let investors a significantly lower entry level onto the UK’s property market.