Developments In Leicester

Leicester is one of the most attractive residential property investment markets in the UK thanks to a thriving economy, rising inward investment, new job creation and steady growth in its domestic population. As a result, investors’ returns – in terms of gross yields and capital values – have ranked amongst the best in the country. 

These impressive market conditions have been driven partly by significant economic growth. Leicester and Leicestershire Economic Partnership (LLEP) writes that the area “has undergone a transformation over the past decade – into an innovative, technology-led and knowledge- driven economy.” 

It’s also an area in which good housing is in short supply. By 2050, local planners expect to have to accommodate around 187,000 new households but, at current building rates, that’s very unlikely to happen. Consequently, now and for the foreseeable future, Leicester looks set to remain an investor’s market very much. 

Economy

Size - c. £24.5 billion GVA
Economic growth target (GVA) - +£5.7 billion per annum by 2030 1 
Employment growth target - +30,000 jobs by 2030 1 
Population growth forecast - +34,800 by 2030 2 
Visitor economy - c. £650 million per annum 3 
Student population - c. 60,000 across 3 universities 
Major investments - East Midlands Freeport, Getting Building Fund etc. 

Property Market

Despite delivering very respectable returns to investors, properties in Leicester remain affordably priced in comparison to the UK average. That tends to support better yields overall and, potentially, could allow more room for subsequent capital appreciation. 

What really matters to investors is future performance. There are clearly no guarantees in any market, but Leicester is at least giving out all the right signals. Demand for housing is strong, stocks are limited and, according to local planners, the city will somehow have to find room for another 187,000 extra households by 2050. That all bodes well for reliable tenant demand and steadily rising capital values.