Investing in property involves more than just purchasing and letting out a house. Savvy investors know to keep an eye out for areas earmarked for growth and regeneration, as these can provide superior returns over time. One way to identify such profitable regions is the UK government’s newly proposed ‘investment zones’. First mentioned by former Prime Minister Liz Truss and recently bolstered by Chancellor Jeremy Hunt, these zones are poised to breathe new life into multiple areas across the UK, according to BuyAssociation.
Investment Zone Programme: A Primer
This ambitious initiative will see 12 broad regions across the UK benefit from an £80 million funding package. This significant investment, to be used over a five-year timetable, is part of the wider government objective of ‘levelling up’ areas of the UK. By implementing spending and tax incentives, the government aims to stimulate productivity and economic expansion.
The ‘levelling up’ agenda is designed to redress regional imbalances, creating job opportunities and facilitating skills development locally. The government’s focus for its investment zones is the cultivation and enhancement of existing technology clusters. Candidate zones are required to prioritise at least one of five sectors: digital and tech, green industries, life sciences, advanced manufacturing, and creative industries.
Beneficiaries of this initiative stand to gain not just from the infusion of funding, but also from a raft of tax incentives such as stamp duty relief, 100% business rates relief, enhanced capital allowances, enhanced structures and buildings allowance, and reduced employer National Insurance contributions.
Investment Zones: An In-Depth Look at the Northern Pioneers
Two regions in the north of England – South Yorkshire and Liverpool – have been announced as the first beneficiaries of the investment zone programme.
South Yorkshire: Forging a Future in Advanced Manufacturing
South Yorkshire, the first official investment zone, is poised to be a hub for advanced manufacturing. This focus is predicted to generate 8,000 new jobs by 2030 and attract £1.2 billion in investments that will boost the economies of Sheffield, Rotherham, Doncaster and Barnsley.
Government sources highlight the significance of this development for South Yorkshire, emphasising its potential to equalise economic disparities in the region and provide growth and opportunities for residents. Cutting-edge aviation research is a central component, with Boeing partnering with Spirit AeroSystems and Loop Technology at Sheffield’s AMRC Factory 2050.
Liverpool: Breeding Ground for Life Sciences
Liverpool emerged as the second investment zone following a successful bid. Mainly targeting life sciences, Liverpool is expected to create 4,000 jobs in the next five years within city and surrounding areas such as Runcorn, St Helen’s, Maghull and Prescot.
With £80million from the government and a potential £300million from private funding, the investment zone scheme is primed to boost local skills and infrastructure. This strategic funding is geared towards propelling Liverpool into prominence as a pharmaceutical production powerhouse.
Investment Zones: A Golden Opportunity for Property Investors
For property investors, these investment zones present an exciting opportunity. Regions designated for regeneration typically see higher-than-average house price appreciation, making them lucrative targets for capital gains.
In addition to the announced zones, the government is further sweetening the pot with a newly assembled ‘supersquad’ of master planners. Backed by £13million in funding, this team is tasked with kick-starting new housing and infrastructure projects, dovetailing with the job creation initiative to establish high-quality homes alongside burgeoning employment opportunities.
Both South Yorkshire and Liverpool are already coveted by property investors due to their affordable property prices, high rental yields and consistent tenant demand.