In the past few weeks, we have seen plenty in the news about Swansea’s proposed regeneration. £1.3 billion has been allocated for projects in the Swansea Bay region, and so far, eleven have been identified, and they include not only the development of the St David’s site, the Kingsway “Central Park” and, most recently, the redevelopment of Castle Gardens, but also the creation of a Waterfront Digital District, and a Life Science and Wellbeing Village in Llanelli.
The specific details of the projects is still subject to change, but if agreed in principle on 1st March (2017), this will be great news for landlords and investors in Swansea.
It’s estimated that 9,500 jobs will be created in Swansea by the regeneration, and a further 20,000 jobs created in Wales in construction alone as the Tidal Lagoon, M4 Relief Road, Newtown Bypass and Eastern Bay Link get underway. The creation of new spaces for start-ups and small businesses in Swansea, as well as the creation of a new City Centre Business District, will further encourage employment in Swansea.
A 5G testbed would also be established with expansion of 4G and wifi capabilities to urban and rural areas.
Already, Wales is seeing employment levels rise to a twenty-month high as businesses expand in the new year. According to the latest Lloyds Bank UK Regional Purchasing Managers Index (PMI), the Welsh PMI rose from 57.4 to 59.6 in January, signalling a faster rater of expansion than across the UK as a whole (55.5). A reading of above 50 signifies growth in business activity.
So what does this all mean for the Swansea rental market?
Where there is employment, there is a need for housing. Not everyone will be looking to buy, and certainly in the construction industry, businesses will be looking to relocate key members of staff to the area, who may have permanent residences elsewhere. Areas benefiting from a boost to employment and amenities should also benefit from an increase in house value.
Better internet also means more desirable rental property. Properties previously dismissed by professionals, such as doctors at the hospitals and professionals who work from home, would then become more desirable, especially if they were in catchments for good schools that previously had poor internet connectivity.
City Centre apartments should see a surge in demand. Young professionals will want to be positioned close to work, but also to cafes, bars, and nightlife, and where better to be located for that than the centre?
Surrounding areas of the city should see a boost, too, with some professionals wanting more space than an apartment might afford, and better provisions for parking and access out of the city.
Overall, most areas should see an uplift in demand for quality rental accommodation with the regeneration.
If you’d like to have a chat about the future of Swansea Bay and how it could benefit your property portfolio, please give the team at McCartan Lettings a call on 01792 430100.
Looking to invest right now? Take a look at this currently tenanted apartment in the heart of the city which is on the market for OIRO £109,995. Click here for the property brochure.
It’s currently getting £650pcm, but a similar flat we have also been managing has recently achieved £700pcm. If the redevelopment of the Kingsway and Business District is completed well, then a rental of £750pcm should be easily achieved. We’ve been managing this property since 2008, so have a full history.
I don’t usually recommend flats due to the service charges, however, looking at the figures and expecting an uplift in the future rental income, this looks like it could be a good opportunity. Full details and figures are in the next article, ‘Buy-to-Let Deals of the Month’.