Five Reasons to Invest in Sheffield

Strong
Capital Growth

The average house price in Sheffield has increased by 18% since the 2020 peak. Leaving the average property price in Sheffield at £226,000. This average price is considerably lower than other northern cities such as Leeds and Manchester where the average property would cost around £278,000.

Between 2014 and 2024, property prices in Sheffield grew by 4.8% on average annually, showing the strong growth the city experienced. This growth was likely a result of the first Heart of the City scheme, which saw thousands of jobs created and the improvement of much of Sheffield’s city centre.

This growth rate creates a stable market for investors with prices climbing higher each year, leading to significant capital appreciation. While property prices may have increased slightly more in other areas of the UK, Sheffield is building upon strong foundations which will allow for sustainable growth over the next decade.

Looking ahead, Savills predicts that house prices in Yorkshire and The Humber will increase by 11.7% in the next 5 years, with Sheffield leading this growth.

Regeneration

Sheffield City Centre is set to benefit from £67m regeneration. This project will include regeneration across five hectares of underutilised land, creating new houses and commercial space to be built, as part of wider regeneration activity.

The first phase of another £300m Sheffield regeneration project began in Autumn 2024 and is due to be complete in 2030. The first phase will include the creation of new homes, a new public realm, a public bridge across the canal, and the redevelopment of six historic buildings including a café, bar, bakery, restaurant, offices and more.

Sheffield previously underwent a large regeneration scheme, Heart of the City 2022, completed in 2023. This saw the creation of 7,000 new jobs and several new amenities. plans added £470m worth of developments and strengthened the local economy.

The ongoing regeneration will lead to many benefits and will level up the city and make it a more attractive destination for both residents and visitors. This will help drive up demand in the area as more buyers will look in the city for the connectivity, amenities, and sustainability that it offers. Regeneration also leads to significant capital growth which will largely benefit investors in the long run, so investing ahead of the completed projects will open the opportunity for higher returns.

High
Rental Returns

Private rents rose to an average of £868 in November 2024, an annual increase of 8.0% from £804 in November 2023. This was higher than the rise in Yorkshire and The Humber (5.7%) over the year.

Rental demand is high in Sheffield, partially because of the graduate retention rate of Sheffield Hallam University. The university is a huge draw for young adults in the city and with many amenities and jobs available, large numbers of graduates stay in Sheffield beyond their university years.

With high rental demand comes higher rental prices and as Sheffield property prices are low, the rental prices offer better yields. The creation of new jobs from the Heart of the City scheme will further fuel this rental demand as more skilled professionals move to Sheffield.

Rental yields for properties in Sheffield reach up to around 7.5%, but yields can vary depending on the area. This offers a large return on investment for investors.

Excellent
Transport Hub

Sheffield is a highly desirable investment city in terms of accessibility and connectivity. Four airports are conveniently located within an hour’s drive of Sheffield, connecting residents globally. The transport hub also boasts impressive road and rail links, including the citywide Supertram network. The tram network connects to 50 stations, allowing residents to commute with ease. Furthermore, it connects commuters with bus services, rail services and six park-and-ride sites. As a result of the effortless journeys, the city attracts an array of skilled professionals who can travel to work efficiently.

This thriving commercial city presents an excellent opportunity for property investors as the capital growth of Sheffield increases. Transport projects are on the horizon, heightening Sheffield’s connectivity. Network North is a scheme that includes upgrading and electrifying lines between Sheffield and Manchester, Leeds, and Hull. Meadowhall station is an idea for a new station to be located near the Meadowhall retail complex and would serve South Yorkshire.

Therefore, broadening the employment possibilities available for the younger and working population. Consequently, this will boost demand for property in the area, with the influx of renters in the market.

The
Greenest UK City

Sheffield boasts the highest tree-to-person ratio in Europe, with over two million of them across the city. With 250 public parks and over 52 square miles of national parks, Sheffield is one of the greenest cities on the continent. The city council are committed to furthering the city’s green living through future developments.

To investors, this means an increased quality of life for residents and a more sustainable future for Sheffield. Securing a development sooner rather than later may put investors in a position of strength as the city council may be reluctant to build on green land in an effort to further strengthen sustainability.

For residents, there are plenty of green activities around the city such as Parkwood Springs which boasts an exciting cycle path for adrenaline junkies. However, for those looking to enjoy a quiet weekend activity, Westwood Country Park is full of history and includes the route of the old railway system, which opened in 1854, making it a perfect location for a long stroll.

CityRise

Sheffield is an exciting northern powerhouse for investors with lots of opportunities for sustained growth. For investors looking for strong capital appreciation, the city has seen property prices rise considerably in the past year and is expected to continue this level of growth over the next few years. However, still has a lower average property price than other northern cities, allowing investors to purchase property before prices climb further.

For landlords, the high yields and rental demand mean that you will see a strong return on investment. With regeneration adding over 7,000 jobs to the city, it will attract more potential tenants to Sheffield, further increasing rental prices in line with demand. For investors looking for property in the north of England, Sheffield has a lot of value in the market.

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