It’s that time of year, when Business Link Magazine invites the region’s business leaders to offer up their predictions for the year ahead.
It has become something of a tradition, given that we’ve been doing this now for over 30 years.
Here we speak to Jonathan Morgan, a partner at Zenko City Living.
It’s fair to say that 2024 was an interesting year for the city centre property market in Leeds. The total number of rental enquiries we received was significantly down on the previous year, but the number of new rental contracts we agreed increased.
This drop off in enquiries was due to the decline in demand for premium city centre rentals from overseas students, following changes to immigration rules introduced in January 2024, combined with lingering concerns about the cost of living in the UK.
Overseas students have typically arrived in the city centre rentals market late in the season and many would choose to rent higher end apartments in locations such as Park Row and Wellington Street.
In addition, several of the larger build to rent (BTR) schemes in Leeds city centre have got used to seeing their overseas student occupancy rate at between 20 and 30%, so this decline has caused some consternation.
Looking ahead, we are focussed on targeting the tens of thousands of young professionals working in well paid jobs in Leeds, who crave the convenience of living in the city centre. To a certain extent, this group has been squeezed out of the market since before Covid and is now returning in significant numbers. As a result, we are confident that 2025 will be a good year for rentals.
In terms of sales, demand in the second half of 2024 was strong and we think 2025 could be the best year since before Covid for owner occupier activity. Inflation is much more manageable, the shock of political change is waning, interest rates are stable and five-year forecasts for house price growth are strong.
Most significantly in the city centre context, more and more buildings are being released from the cladding issues which previously made them unsellable. At the same time, significant infrastructure change is coming to fruition, making for a much more attractive environment.
In addition, we remain the only city outside London to have resident opera, theatre and ballet companies; our diverse and resilient economy is widely understood, our universities attract over 60,000 young people a year, our retail and leisure space is nicely balanced, we have a railway station which will deliver you to London in around two hours, a regional airport connecting directly to most European cities and, an hour’s train ride away, an airport which connects with the rest of the world.
The city’s skyline is currently peppered with cranes delivering new developments and we are excited and confident about the future of city living in Leeds and look forward to unlocking the next generation of city centre homes for sale and to rent in 2025.
