Cambridge has been a property hotspot for several decades now. However, it could become much hotter in the coming years with a new proposal from the government to expand the city. In this report we will look at what the proposals might mean for the city and the practicalities of taking them forward.
Firstly, many people would agree that any proposal which includes expanding the Cambridge economy is in some ways an odd one. The city is already bursting at the seams. There are certainly other regional cities which arguably have more scope for expansion, and more easily and cheaply too.
Yet it is Cambridge’s undoubted global pre-eminence that is probably behind the proposals. This is not just (and perhaps not even) its status in the academic world but its pre-eminence in technology. The so-called Cambridge Cluster is Europe’s largest technology cluster and the third largest worldwide. It employs 61,000 people across 5,000 firms with a combined annual revenue of £15.5bn. So, it could be argued that any expansion of Cambridge, perverse although it may seem, would benefit the UK as a whole.
The heat within Cambridge’s property market is demonstrated by prices and rents here. The average house price of £515,000 is similar to London and around 70% more than the English average (HM Land Registry figures). The average rent is just over £2,800pm compared to a national average of just over £1,000 (Home.co.uk figures). Supply of houses to buy and to rent is tight and demand is high. Even those with the well paid jobs the city offers struggle to buy or rent here.
Robert Price, owner of Belvoir Cambridge, tells us about the sales market here – although suggests it has cooled a little of late: “I believe the days of multiple people bidding for your property are over and prices need to be more realistic. In the last week alone 15 properties have dropped in price by around 7% (average £37,000), and although we are still seeing some properties selling quickly, these seem to be the ones that are priced correctly. The ones that have been on the market longer have had to drop the price to sell. As we move to the colder months it will be interesting to see how the market changes, and if mortgage rates improve then that will also have (we hope) a positive effect.”
