01/09/2017 0 Comments
As a Chester based property specialist, we naturally have a keen appreciation of the market conditions prevailing within one of Britain's most historic cities. In the course of our work, we routinely help clients to buy and sell homes here, to find quality rented accommodation and, of course, to make profitable, well informed investments.
In this article, we thought we'd explain what makes Chester's property market so special.
First, of course, there are the aesthetic considerations. Anyone who has even a passing acquaintance with the city will be familiar with its beauty, its character and its rich history. Just say the name and images of ancient walls and half-timbered buildings spring unbidden to mind. Visitors and residents alike will understand why it regularly makes the top listings of foreign visitors' favourite city destinations. Home to roman ruins and one of the country's best loved race courses, it has a thriving tourist economy that seems to grow stronger every year.
But an extensive count of such familiar strengths is essentially unnecessary; as a gem of British heritage, as one of the region's leading tourist attractions, Chester is already widely renowned. Most readers won't require a long list of superlatives in order to appreciate that the city is a unique and bewitching place to live. Numerous surveys and 'quality of life' indices would certainly support that view.
Looking beyond the immediate doorstep appeal of a typical city home, what else separates Chester properties from those in other regions? Beautiful and desirable the location may be, but does it make sound financial sense to relocate or invest here?
The Economic Argument:
In answering that question it is worth examining the economic health of the region. Any prospective homeowner or tenant will doubtless want to know how the city is likely to fare in the challenging years ahead; whether neighbourhoods will continue to prosper; whether Chester is capable of sustaining the same enviable quality of life it offers today.
Happily, all the indications are good. Local business conditions are healthy, buoyed by a number of large, well established employers, and the region is attracting considerable volumes of new investment from both the public and private sectors.
Despite its evident history, Chester is not a city wedded to the past. It is home to many forward-focused businesses and it affords a base for workers engaged in some of the UK's most advanced industries. It boasts a thriving financial sector - sustained by major players such as Bank of America, HBOS, Virgin Money and Marks & Spencer Money - and it has always benefited from its well established chemical, pharmaceutical, automotive and manufacturing sectors. This is an impressive feat for a moderately small city with only around 118,000 inhabitants.
One particular growth sector is advanced manufacturing. A relatively recent development has been the creation of a large Airbus UK factory in Broughton. The facility is responsible for the production of Airbus A380 wings and now sustains around six thousand jobs. Its workforce continues to grow, boosting the local economy and fuelling healthy demand for property.
Other large local employers include Moneysupermarket.com, which has its registered head office in nearby Ewloe. There is also the Countess of Chester Hospital, the frozen foods company Iceland and, of course, the tourism industry itself. Collectively, tourist businesses contribute £1.78 billion to the local economy each year and sustain approximately 27,000 jobs.
Another significant employer is University of Chester, one of the oldest higher education institutions in the country. It has five campuses in the city alone, including a science park, a business school and sites teaching a variety of vocational courses.
These organisations are all helping to ensure that prospects for employment remain excellent, that the property market remains buoyant, and that living conditions in and around Chester remain amongst the most appealing in all the country.
Some of the most notable developments in the vicinity of Chester are being orchestrated by the Chester Renaissance Board as part of a 15-year regeneration programme. Called the One City Plan, it is designed to run from 2012 to 2027 over three phases. The first phase saw £37 million invested in a new 800-seat theatre, which economic development experts predict will support 400 jobs and attract an extra £17 million of visitor spending each year. Phase 1 also includes the construction of the £300 million Chester Northgate Scheme - a retail and leisure development that seeks to generate around £140 million of extra annual income and to deliver 1,000 permanent new jobs.
Meanwhile, the city centre itself will be undergoing a £100 million facelift, through which planners seek to enhance the shopper/visitor experience, boost the retail sector and thereby support around 3,500 new jobs by 2028.
Elsewhere, Chester's Cathedral Quarter will be the subject of regeneration work. The city will also benefit from a new waterfront development and a business improvement district. In subsequent phases, the One City Plan will also deliver improvements to the Castle Gateway, Chester's famous Roman amphitheatre, the racecourse and several other well known city districts.
Further out, Chester Zoo will see a £225 million upgrade, which is part of a tourist strategy designed to produce a 100% increase in visitor numbers by the middle of the next decade. If successful, that strategy would swell the tourist revenue coffers by as much as Â£3 billion each year.
Cheshire Science Corridor is yet another important development. In March 2017, growth director John Adlen noted its potential to energise the regions economy, explaining that the Â 250-acre enterprise zone was designed to attract international investment, to support 20,000 new jobs and 500 new businesses. He said: "We want to put Cheshire on the map with its outstanding science and technology assets. Our aspiration is to create a new golden triangle in the North." The site will focus on high value, knowledge-based sectors such as energy technologies and biotechnology.
And so the list goes on. In the pipeline, there are also approved plans for new hotels and supermarkets, new office developments, and infrastructure improvements to support it all - including improved rail links to John Lennon Airport.
In short, there is every reason to believe that Chester's fortunes are on an upward curve; that business will continue to thrive and that the city as whole will benefit from a steadily improving economy. Should that prove to be the case, then that will spell unequivocally good news for residents, home-buyers and anyone with a commercial stake in the city.
Chester's Housing Market
Despite all the activity now taking place in Chester, local property prices are still affordable, particularly when compared to the overheated markets of the South. Accordingly, those seeking attractive, high quality rented accommodation can still find reasonably priced apartments within easy commuting distance of all the major centres of employment. Likewise, investors will recognise that lower absolute prices often translate into very attractive yields.
Chester - Key Facts
According to the LendInvest Buy-to-Let Report for June 2017, the average Chester property rose in value by 3.8% over the last 12 months.Â Rental prices rose by 5% and average rental yields stood at 4.87%.
For house buyers, the prospects are equally encouraging. Borrowing rates are currently at an all-time low, properties in Chester are still sensibly priced and the prospects for capital appreciation are extremely encouraging. Given the perennial shortage of good family homes on the market, prices were already destined to increase, but given the scale of inward investment, more jobs and more people with disposable incomes should see capital values rising steadily.
Over the last year, affordability concerns have had a constraining effect on price growth at the national level but northern markets have been less affected than those in the South. Having risen at a slower rate, prices in the North now have greater room to move. For markets like Chester, where people are drawn by the promise of a better quality of life, the implications can only be positive.