Oxford Property Price Forecast – Demand Hits New Heights
Oxford is one of the most famous cities in the UK, centered around a world-class university and featuring one of the most diverse technology sectors in the country.
With easy access to London (and in the same region as Cambridge), Oxford has followed a similar trend to the capital’s property market, experiencing meteoric rises in price before stagnating this year.
Recognised for its world-class science and information assets; helping attract high-growth companies, a talented pool of workers that sits at 434,8000 strong and a total output (GVA) of £21.9 billion, the Oxfordshire economy is one of the strongest nationally, especially in the South.
Oxford sits at the heart of this thriving economy and is forecasting excellent economic success as part of the ‘Growth Corridor’ that includes Oxford, Milton Keynes and Cambridge.
This has contributed to the city’s recovery since the crash in 2008, now ranking 3rd in the country with property prices increasing by 55% compared with a decade ago. This puts the city just behind London (+65%) and Cambridge (+70%), driving a huge amount of demand for housing in the area.
Oxford seems to be continuing to follow the trends seen in London and Cambridge, which saw property prices decline recently before moving back into positive growth. While this resulted in a small drop, Oxford fared better overall, maintaining a small but encouraging increase of 0.3% over the last three months.
Unfortunately, these rises in house prices haven’t been matched with the rise in average salary. Oxford tops the list of ‘least affordable place to live in the UK’, with average house prices sitting around £497,354 in 2018, 15 times the average annual earning which is £29,317.
Demand reaches new levels
Thanks to the power of its professional, scientific and education sectors, demand has never been higher. With the Oxfordshire population predicted to grow by 30% from 702k in 2018 to 911k in 2037, it’s only going to continue.
Commercially, Oxford has plenty to offer with a large market for working professionals, over 4,800 businesses collectively employing 135,000 people. Although the various education hubs around the city employ a large majority of this workforce, other sectors such as publishing, tourism, hospitality and high-technology industries are significant for employment.
The city also has an unemployment rate of less than 1%, with a large majority of the working-age residents economically active. This is much lower than the national average, which currently sits at around 4%.
Around 9.5 million visitors each year are attracted to Oxford, generating an impressive £58,150 in GVA per worker, ranking Oxford the 7th highest GVA city. The area has a very strong economic and a high demand for housing.
All of this means that despite relative unaffordability in the property market, Oxford is still a huge draw for working professionals, global businesses and academics, making any residential property in the area an excellent investment in terms of tenant demand, particularly if rates are competitive and targeted towards professionals or students.
Significant investment into rail infrastructure
Oxfordshire as a region still remains a top location for domestic and overseas investment. Foreign direct investment (FDI) is one of the biggest drivers of success for the area with 1,300 new jobs being created – a 122% increase on last years figures.
One of the region’s largest developments – the East-West Rail Project – looks to reconnect Oxford and Cambridge alongside building new links to Bicester and Bedford (due 2023) as well as Milton Keynes and Aylesbury (due 2024).
While providing excellent transport links for the region, it’ll also improve travel times to the capital, making commuting an easier proposition and further raising Oxford’s status as a commuter destination for London workers.
Heading into 2019 and beyond, Oxford looks set to return to positive growth, maintaining its status as a global education hub and an ideal destination for high-technology industries to flourish. As more companies recognise Oxford as one of the strongest economies in the UK, the demand will continue to rise, increasing the opportunities for property investors and landlords to benefit from.
Although it currently remains unaffordable for most buyers, the demand for rental properties in and around Oxford is still high. As the private rented sector grows, Oxford may be one of the cities that benefits the most from Government regulations that favour tenants.
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