High Speed 2 (HS2) is the largest infrastructure project in Europe and will form the backbone of the UK’s transport network, connecting eight out of ten of the UK’s largest cities[1]. The 25 stations which will eventually form part of the HS2 network will connecting an estimated 30 million people (roughly half of the UK’s population) unleashing massive employment and economic potential for the UK.
HS2 was initially proposed in 2009 by the Labour Party, the original plans for HS2 has evolved over time and was finally approved by Boris Johnson in February 2020. The approved plans now include a revised completion timeline of 2028-2031 for the first phase and 2035-2040 for the second phase along with an amended budget of GBP106 billion.
This brand-new railway line will run between London and the West Midlands and will then be extended to Manchester in the North West and to Leeds as part of the second phase. The premise of HS2 has been loosely based upon the Shinkansen train system in Japan[2], the line would enable trains to reach speeds of up to 250 mph and offers the potential to deliver the same transformational benefits to the UK as did the Shinkansen line did to Japan.
In this blog we will explore how HS2 will affect the following cities: Birmingham, Leeds and Manchester.
Birmingham
When talking about HS2, Birmingham has been the city at the forefront of this revolutionary rail infrastructure plan. Once complete, journey times from Birmingham to London will be reduced to a mere 49 minutes, making the city a new and more accessible work market for many professionals.
The Curzon Masterplan, initially launched back in 2014 with the aspiration for growth around the Curzon Street station the terminus station for HS2 in Birmingham, will be simultaneously linked to the arrival of HS2 to the city. According to the Birmingham Curzon Investment Plan[3], delivery of this infrastructure scheme will be a major driver of growth and regeneration to the area with the inclusion of over 600,000sq.m of commercial space, 4,000 new homes, 36,000 newly created jobs and over GBP 1.7 billion of private sector investment.
Unsurprisingly, HS2 and the ongoing regeneration plans outlined for the city, are having a huge impact on property prices Birmingham, with the latest forecasts anticipating house prices to increase by 15% by 2023[4]. Property investors and buyers are jumping at the opportunity to buy in Birmingham, which is being referred to as being ‘up and coming’ as well as affordable, with a current affordability ratio of 5.6x. New research conducted by Zoopla, UK Cities House Price Index December 2019[5], highlighted that demand for new housing across 20 UK cities during the 4 weeks to 20 January 2020, was on average 26% higher compared to the same period in 2018 and 2019. Birmingham was one of 11 cities which witnessed a growth in demand that was higher than 20 city average, a 1.1% increase.
Leeds
Leeds is one of Yorkshire’s largest cities and is set to be a city which will benefit the most from the arrival of HS2, significantly improving transport links to other cities in the UK. Journey times to Leeds will be drastically improved – London in 81 minutes, Birmingham in 49 minutes, and Sheffield in 27 minutes. Since the announcement that HS2 is coming to Leeds over GBP500 million of investment has been attracted to Leeds. It has also been predicted by the Leeds City Region that their HS2 Growth Strategy will create circa. 40,000 additional jobs – a GBP 54 billion boost to the local economy by 2050[6]. The South Bank Leeds regeneration scheme is set to the double the size of Leeds City Centre and the proposals include a new city park, transformation of the current waterfront shops and bars. This new scheme is also set to create over 35,000 new jobs, over 8,000 new home and educational facilities for over 10,000 students.
Leeds is already a huge contributor to the UK’s economy, coming in second to London, with 120,000 businesses in the local area generating a total GVA in excess of £60 billion. The population of Leeds is currently around 795,000 and is expected to increase by 39,000 by 2029. The city’s popular universities will likely become an even more attractive place to live, study, work and commute to and from when HS2 is fully operational. The prospect of HS2 is already having an impact on house prices in the area. According Land Registry, both house price and rental growth in the city are both expected to increase by 16% by 2023. Houses price in the city have already increased by 35.6% in the ten years to July 2019.
Manchester
When HS2 was initially proposed and one of the arguments for this scheme was to bridge the gap that sits between South England and Northern England, to bring jobs, homes, investments and economic growth to cities other than London. HS2 will be integral to local plans put forward by Manchester City Council and Trafford Council to drive growth. In particular, the redevelopment of Manchester Piccadilly station is expected to create 40,000 new jobs and 13,000 new homes – this has been recognised as one of the biggest development opportunities in the UK[7].
In recent years, Manchester has undergone some significant regeneration work and has become a bustling and thriving cosmopolitan city. According to the latest research from Zoopla, house prices have increased by 4.5% year-on-year for December 2019, which was the fourth highest of year behind, Nottingham, Edinburgh and Glasgow. Manchester is set to form a huge part in the HS2 route connecting London and the northern regions on a larger scale than previously seen.
If you would like to find out more about investing in one of these property hotspots, contact the team today on +44 (0)20 3551 9899.
[1] HS2 Our Story and Key Facts, [2] HS2 Realising the Potential, [3] Birmingham Curzon Investment Plan, [4] https://res.cloudinary.com/jll-global-olm-np/image/upload/v1569515140/resi/gb/cms/Research/PDFs/JLL%20UK%20Residential%20Forecasts%20-%20your%20complete%20view%20for%202018%20and%20beyond/JLL-Residential-Forecasts-West_Midlands-2019_1.pdf, [5] https://advantage.zpg.co.uk/wp-content/uploads/2020/01/Zoopla-UK-Cities-House-Price-Index-Report-December-2019-1.pdf, [6] https://www.hs2.org.uk/stations/leeds-station/, [7] https://www.hs2.org.uk/stations/manchester-piccadilly/
