Leeds is in a property arms race with Manchester, according to leading estate agents from the city, writes Sharon Dale
The last property boom gave Leeds city centre all the hallmarks of success. Skyscrapers, penthouses, top restaurants and the first branch of Harvey Nichols outside London, which saw it dubbed “Knightsbridge of the North.”
Developers went into overdrive, building hundreds of apartments to fulfil a demand for city living until a double blow. London architect Maxwell Hutchinson branded Leeds “the empty flats capital of the North” and predicted that its apartments would be the “slums of the future”. Then the banking crisis hit and no-one could get a mortgage or funding for construction.
Now the recession is over and the flats are full with a clear need for more. Yet, despite the undisputed success of city living, borrowing is proving to be an issue thanks to the stigma created by Hutchinson’s headline-grabbing remarks.
Naveen Ahmed, MD of Parklane Properties, is expanding the firm’s luxury accommodation brand, IconInc, aimed at students and young professionals. He says that while banks are more than happy to lend on schemes in nearby Manchester, they are less enthusiastic when it comes to supporting them in Leeds.
“In the end, we ended up funding our development in Leeds ourselves,” he says. “There seems to be a problem as far as some banks are concerned and that’s unfair because this is an incredibly successful city.”
Jonathan Morgan, MD of Morgans sales and lettings, agrees: “Hutchinson’s comments have stuck and we feel the effects every day. If we get an enquiry from the south of England then the expectation is that it’s easy to buy or rent a flat in Leeds because we’ve got so many empty. Nothing could be further from the truth.”
“Their airport is certainly better than ours and the council is more risk-friendly and happy to enter into joint ventures with developers. However, we are a dynamic city, our arena is better than Manchester’s and our city centre is far more attractive. I also think Leeds offers a much better quality of life. Don’t get me wrong, I like going to Manchester but I like coming away again. It’s not somewhere I’d like to live,” says Jonathan.
The rental market in Leeds centre is booming and the sales market is also buoyant with interest from investors. Prices are similar to Manchester, starting around £90,000 for a one-bed flat and have climbed back to pre-2008 levels.
Satty Bhamra, sales manager at Parklane Properties, expects them to rise significantly: “Surveyors are down-valuing and being cautious and this is keeping an increase in prices at bay but as more properties sell, values will increase. There could be a rise of 20 to 25 per cent over the next 12 to 18 months.” House prices in desirable suburbs such as Roundhay and Horsforth are comparable with those in Manchester.