Edinburgh is Scotland’s capital city, and the sixth largest financial centre in Europe. Home to the Scottish Parliament, and central to the Scottish Government’s administration, the city has a population of 495,000 people and a catchment population of approximately 1.6 million people in the surrounding Lothian and Fife areas. With projected population growth of 7% over the next decade, the city is thriving and experiencing GDP growth above both UK and European averages resulting from high value service sector activities which account for 85% of Edinburgh’s employment.
The city is also a major centre for Government, science and technology, and is highly acclaimed for education, tourism and the arts. It’s rapidly expanding technology sector benefits from high quality graduate output from Edinburgh’s four universities. Over 100,000 students study in the city at any one time, including more than 17,000 international students, and this offers a rich opportunity for progressive companies to recruit staff.
Edinburgh is a UNESCO World Heritage Site, and a major tourism destination attracting around 3.54 million visitors a year to enjoy the city and major cultural events such as the Edinburgh Festival. Edinburgh is regularly voted one of Europe’s most attractive places to work and live, and draws business visitors for a diverse range of conferences which generate around £300 million a year for the city.
The city has a diverse financial and business community, and is home to more FTSE 100 companies than any other city in the UK outside London. Employing around 35,000 people in financial services, the city is home to two of the world’s top 150 financial services companies, and has substantial presences from companies including Royal Bank of Scotland, Lloyds, Scottish Widows, Tesco Bank, Virgin Money and JP Morgan. In addition, the city’s thriving technology sector has seen rapid growth with office take up rising substantially for these companies over the last three years.
Substantial future investment in the city includes key projects such as the new Queensferry Crossing bridging the Firth of Forth, the new Edinburgh Gateway Railway Station, the Borders Railway Line, the Edinburgh tram system (due to be extended to Leith), and very significant further investment in Edinburgh International Airport and the University of Edinburgh.
The Residential Market
In Scotland, Edinburgh is leading the market with values in the majority of areas at or above pre-recession peaks, and with sustainable growth forecast over the next five years. Average sale prices are the highest of all local authority areas, and 34% ahead of Scottish average. Growth in main stream capital values is forecast to be 20.5% between 2015 and 2019, compared with 17.6% across UK as a whole.
The new build market in Edinburgh continues to be strong with the average selling price being £269 per sq. ft. and it is forecast that Edinburgh requires 3,526 new households annually between now and 2035. It is therefore anticipated that both high demand and high residential values will continue as a result of constraints on the supply of new build properties.
Affordability is a significant issue in the market in general, and in Edinburgh in particular. Granton Waterfront offers the opportunity to build housing close to the city centre but at a price point which is more affordable for the wider population.