Despite London offering a prime housing market for key property developers across the UK and internationally, the reformed stamp duty announced by former chancellor George Osborne in 2014 saw a hike in property acquisition tax which proved to lead to a fall in home values in the capital. Research by Haart in 2016 saw that while the average salary is around 25% higher in London when compared to the rest of the UK, homebuyers pay approximately 750% more stamp duty than other homeowners due to the high property prices. The additional SDLT reforms in April 2016 saw an additional 3% stamp duty on second homes which led to even further worries. As a result of this, a number of property developers are searching for prime housing markets outside of the capital in order to optimise their portfolios.
According to research carried out by Hometrack into the top 20 cities in the UK, Manchester is the third most valuable property market in the country. Manchester has experienced a strong increase in house prices over the past few months, and the total value of homes in the area are said to be worth £133bn. Throughout 2017, a number of properties have been developed in the city, and with the digital tech boom resonating through the job market in the area, hundreds of people are likely to move to the city in search of new careers. The predicted house price figures for the North West are 18.1%, with Manchester playing a key role in driving these prices up. Despite Brexit negotiations, the UK property market is likely to continue to attract plenty of international investment with Manchester maintaining a key focus.
With the brand-new glass-fronted offices of Birmingham’s business district Colmore Row, the city has begun to blossom into a truly diverse and promising area for property development. Due to a number of major financial and professional firms moving proportions of their operations towards Birmingham and other areas in the Midlands, the city is beginning to grow. With a 20-year vision published in 2010, Birmingham’s transport system is set to expand and improve, with the integration of High Speed 2 which could make the process of accessing London much easier and quicker. As a result of the city’s new innovations and billions of pounds being put into major development options, the city is beginning to open up a number of impressive property development opportunities.
Leeds has continued to grow steadily over the past few years and while other cities across the country began to reduce their investment after the financial crisis, Leeds is continuing to pump funds into new areas. With a number of commercial developments and regenerations taking place, including Trinity shopping centre, Victoria Gate and Kirkgate Market, the demand for jobs has increased and as a result, so has the demand for residential property. In addition to this, road connections and other infrastructure are well developed, with easy access to both London and Edinburgh so it’s an ideal location for businessmen and women alike. With the prime housing markets in the city already being driven by high demand and low supply, there are numerous development opportunities for those looking for strong yield from rental income.
With London prices continuing to rise, 2018 is set to push other cities such as Manchester, Birmingham and Leeds to the forefront of property development. With alternative finance options such as bridging loans available for those looking to access these markets quickly and efficiently, property developers have more options than ever, despite the challenges implemented by socio-political movements such as Brexit.