Doncaster Area Guide

Regeneration and Inward Investment

When it comes to inward investment and capital projects, Doncaster has almost an embarrassment of riches. Many hundreds of millions of pounds are being spent in Britain’s newest city and the longer-term impacts should be profound. Some of the more notable examples include:

• ·        Civic and Cultural Quarter: £300 million

• ·        Verdion development at iPort (latest phase): £300 million GDV

• ·        Doncaster Urban Centre Masterplan: £25 million

The Doncaster Housing Market

Average property prices have been rising very sharply in Doncaster. According to a press release issued by Halifax in November 2022, prices in the city rose by +18.3% year-on-year. That figure was beaten only by Sheffield, which delivered annual capital growth of +18.9%.

Despite this, prices have remained very affordable by national standards. According to a Zoopla report in November 2022, average values (across all property types) stood at £178,57 in Doncaster. That compares against a UK mean of £261,600.

Lower investment costs inevitably help to make higher yields easier to achieve, particularly when – as in Doncaster – rental demand is intense and supply severely limited. It’s an imbalance that has driven rental returns steadily higher in recent months. Homelet’s monthly rental index doesn’t include a city-by-city breakdown, but it does record that, in Yorkshire & Humber, rental values rose by +8.4% in the year to October 2022. More anecdotally, local Doncaster estate agents and lettings agents have reported that, in some districts and for some property types, rental values have risen by as much as +20%.

Property Market Predictions

UK-wide capital growth forecasts for 2023 are broadly negative – a reaction to the cost-of-living crisis, higher mortgage rates and global economic uncertainty. However, many sources expect prices to contract only for a short period, followed by a recovery in 2024.

UK-wide, Savills is predicting cumulative price growth of +6.2% by 2027 but it expects Yorkshire & Humber to recover more quickly. It expects the region (as well as the North West and the North East) to see average growth of +11.7% over the same period. While capital forecasts are hardly spectacular, no other British region is expected to outperform Yorkshire. It is also worth noting that the Bank of England expects inflation to drop back sharply in 2024, perhaps even to turn negative, so the real-terms returns on investment should be considerably better than at present.

Investors may well see the best returns from locations characterised by:

·        Affordable prices

·        Continued economic growth and inward investment

·        Strong and reliable demand for housing

·        Significantly constrained supply

For these reasons, Doncaster can be expected to remain one of the UK’s most rewarding property investment locations.