Rising cost of debt and cost of living pressures does little to subdue demand for homes in Bristol
The rising cost of debt and cost of living pressures did little to subdue demand for homes in Bristol with average sales and rental values rising 3.6% and 13.4% respectively according to the latest research from JLL.
The ‘Big Six’ research, which tracks residential development activity, prices and rents across Manchester, Birmingham, Leeds, Bristol, Edinburgh and Glasgow, highlighted continued demand from young professionals and both domestic and international students as the key drivers for the increase in value, alongside a reduction in supply and building and planning constraints.
In Bristol, rental property stock has fallen by 14% in Q2 2023 and by 18% since before the pandemic, as landlords continued to leave the market due to economic constraints. At the same time, over the past ten years the city’s population grew well above the UK average at 10.3%, placing even greater pressure on the residential market.
The increase in rents across the ‘big six’ clearly demonstrates not only the demand for city centre living but also the need for more homes. This is not exclusive to the rental market, with a requirement for more homes of all tenures needed to address demand.
Looking at the sales market, property values also grew but at a slower pace at 3.6%. That said, one bedroom apartments had the highest growth at 8.7% overall well ahead of the national average, with the average price now sitting at £250,000.
Nicholas Rumble, director of residential development in Bristol, commented: “Bristol has long been a victim of its own success. It continues to provide a place where people want to live, work and study but it has been hampered by a lack of available residential properties and tight planning regulation which has slowed new properties coming to market. If we are to keep up with this continued demand and allow the economy to keep growing, then we need to encourage more housebuilding in the places where we need it most.”
Marcus Dixon, director of UK residential research at JLL, said: “Younger residents and students are continuing to drive demand across the UK’s regional cities, as they prioritise the neighbourhood in which they live and access to key amenities. This is a trend that we expect to continue, particularly as young professionals seek employment opportunities outside of the capital due to cost of living pressures.
“What has become clear through our analysis is that neither the sales nor rental market is currently able to keep up with demand. With fewer landlords entering the market, and the rate of new builds slowing, government intervention is needed to restimulate the market and ensure that there are enough homes for the people that need them. By creating opportunities for people to live and work in our regional cities, it will stimulate further inward investment and contribute to the success of our cities long term.”
