Newcastle is set to flourish in the years ahead, driven by devolution and the expansion of its knowledge and tech industries, research from Avison Young has found.
This could mean it’s a prime area for buy-to-let investors to secure strong yields and capital gains in the years ahead.
The North East is subject to an upcoming £4.2bn devolution deal, which should aid regeneration projects, as well as the creation of new residential and commercial developments.
Newcastle’s digital and tech economy has expanded by 51% since 2013, while growth is centred around fintech, greentech and cyber security.
Gordon Hewling, regional managing director for Newcastle at Avison Young UK, said: “Across the North East, there are many transformational schemes coming forward.
“When considered alongside the upcoming devolution process and the investment that will unlock, it’s clear that the region has never had a better chance to build on its vision for change, removing obstacles and creating an environment to deliver both short-term and long-term wins.
“From education and job opportunities to quality housing and better health outcomes, we’re setting a course to deliver meaningful change.”
In the first half of 2022, tech job vacancies grew by 75% in Newcastle, compared to only 25% in Birmingham, and the city has also seen a 40% increase in people employed in artificial intelligence roles.
According to data from Oxford Economics, Newcastle’s information and communication sector is expected to see growth of over 12% in the next five years, and its science and tech sector will see growth of over 8% during the same period.
Newcastle Helix is one major regeneration project, a 24-acre area of the city which is harnessing the research strength of its hospital and university partners in building a tech and science community, with residential and hotel opportunities to follow.
Other notable schemes include Forth Yards, which will deliver a new gateway to the city and an infrastructure network to connect the area, and the Health Innovation Neighbourhood (HIN), a joint venture between Newcastle University and Genr8 Developments, centred on the former General Hospital site, which will integrate world-leading research and innovation to provide solutions for intergenerational living, leisure, learning and employment. In addition, the redevelopment of Pilgrim Street will see nearly 1m sq. ft of new stock delivered, which will be home to 15,000 workers, creating £300m GVA per year.
The city’s labour market is also expected to see significant growth over the next five years, with Oxford Economics forecasting 3.8% growth for Newcastle by 2028 compared with 3.1% for the UK as a whole.