The £37.5m Town Deal cash injection can help transform Southport and local property professionals say the demand for homes in the town is soaring. Tony McDonough reports
Property professionals in Southport say they fully support plans to diversify its economy but adds there will be a need to address a shortage of homes in and around the town.
Rachel Fitzgerald, chief executive of Southport BID, says the COVID-19 pandemic has shown how Southport is over-reliant on its successful hospitality and leisure sector. She says the town needs to diversify its business base to future-proof its economy.
In an article earlier this month, Rachel welcomed the £37.5m secured for Southport in the Government’s latest Town Deal funding round. She added: “We must see this support as just the start of a journey where we radically reimagine Southport and its economy.
“Tourism and hospitality have been the bedrock of our economy for more than 200 years and it will continue to be a major driver in the coming decades. One of the most important lessons of the COVID-19 pandemic has been the danger of putting too many eggs in one basket.
“A place that it over-dependent on one particular business sector will always be vulnerable to major shocks.”
In recent months entrepreneurs and professionals in sectors such as law, digital and education have all backed her vision for Southport. Now the town’s property sector is also getting behind the push.
First-time buyers
Karen Potter is one of Southport’s, and the North West’s, most experienced estate agents. She states that whilst the town is already a hotspot for young people looking to buy their first home, she is optimistic that more people can be attracted to Southport to live and work.
She is owner of Karen Potter The Estate Agent, a business she founded 11 years ago. She has worked as an estate agent for 39 years and is a Fellow of the National Association of Estate Agents. The Bank of England regularly calls on Karen’s expertise and knowledge when making its assessments of the economy.
“Traditionally Southport has been considered a very sedate place and it is certainly true it attracts people who want to retire here,” she said. “Often they have happy memories of visiting the town for holidays and day trips when they were younger and so it holds a special place in their hearts.
“We have many fantastic retirement developments here. However, there is also a significant number of younger first-time buyers, predominantly people who have grown up in and around the town and I’m confident we appeal to younger people from farther afield to come and live here.”
She agrees it would be advantageous for Southport to diversify its economy and be less reliant on the tourism and hospitality sectors. She adds that in order to give the retail sector a boost and attracting more shoppers, she feels the well-established cluster phenomenon of bringing more shops together in one place, is worth considering.
“I think if we really concentrated the retail sector around the beautiful Lord Street area, persuade businesses from other parts of the town to relocate more into the centre, then that could be advantageous to the retail sector,” explained Karen.
“Maybe then we could look at using the commercial space left behind to attract new businesses into the town such as more professional firms. At the same time we have to make sure we preserve the heritage and the beautiful listed buildings. Its what gives Southport its unique and individual character.”
COVID-19 has had a devastating impact on swathes of the economy but Karen reports that home sales, and prices in the town have soared. She said: “At the start of the first lock-down last March, we furloughed all of our staff, apart from myself and my daughter Paige, to run the business from home.
“But when we came out of the lockdown in May everything just took off and we really hit the ground running. I thought that COVID would make people reluctant to enter the market but the opposite was true.
“We found ourselves dealing with lots of people who were keen to buy homes in Southport. Around half were from the town and the other half from outside. And this was even before the Chancellor announced the Stamp Duty holiday. After that it got busier still and during 2020 we have seen prices rise by 5 to 6%.
“The world has changed so much. Because there was no real holiday season in August the market didn’t change like it normally did. It has put professionals such as lenders and solicitors under real pressure to operate in these unprecedented circumstances. Peoples’ lives have just changed so much.”
Lettings boom
Jacqui Holt is sales and lettings director at Anthony James Estate Agents and has been working as an agent in the lettings market since 2006. She explained how the COVID-19 pandemic had had a dramatic effect on the local lettings market and exposed the shortage of good quality houses in the town.
“We have a very busy market at the moment,” said Jacqui, “We simply don’t have the supply of property to meet the current demand for lettings. If we post one house up we will likely very quickly get about 150 enquiries.
“We have had to change the way we do things during the pandemic. In particular, we have switched to video viewings of properties. I know once we put a property up, it will be gone within three hours. I’ve never known people so keen to sign up without having visited the property first.”
Jacqui stressed the supply issue relates to houses rather than apartments, of which she says there is currently a steady supply in the town. She said there were lots of people who had stayed with vulnerable family members during the pandemic who were now looking for a house. She added there was also a significant number of people who were leaving relationships.
“We are also seeing demand from doctors and nurses who have come from overseas to work at the hospital – we try our best to help get homes for as many of those as we can,” she said.
Similar to many other locations around the country, Southport is suffering from a shortage of good quality housing. Jacqui is fully behind Rachel’s vision but says there will be a need to build more houses in the next few years to accommodate a growth and diversification in the economy.
She adds the current problem is being exacerbated by the number of buy-to-let landlords who are leaving the sector. Research from the National Residential Landlords Association that up to a third of landlords are considering an exit from the market, put off by higher taxes and increased regulation.
“For example, there are now tighter regulations around electrics in properties,” said Jacqui. “And it is this increased regulation that is pushing some out of the market. However, for those that stay in, the current market means they are spoilt for choice when it comes to tenants. The Airbnb market is also becoming more popular.
“Until the last 12 months, rents in Southport had not increased for 10 years. However, such is the strength of the current demand, we are now seeing a rise in rents. You also have to look at the state of the economy. When there is a downturn this usually leads to an increase in people looking to rent.
“If people want to buy a house at the moment, they will typically need a deposit of 10-15%. Any decent house in Southport will cost upwards of £100,000 so getting together a deposit that size is difficult, particularly for younger buyers. So we are now seeing the average age of first-time buyers rise significantly.
Quality of life
An estate agent in Southport since the 1980s, Chris Tinsley launched his own business – Chris Tinsley Estate Agents – in 2001. It employs 11 people and operates from an office in the town centre. It handles purely residential sales.
Chris believes the notion that Southport is primarily a destination for those who wish to retire by the seaside historically has some truth, but it is now a little outdated. He said: “We see buyers of all ages now.
“Southport is a very attractive place to live. We have a beautiful coast, parks, countryside and good schools. So these are real plusses for young buyers looking for a better quality of life. However, the town centre is struggling a little bit. On a Saturday afternoon you might see a lot of people on Lord Street, but not enough of them are carrying shopping bags.
“It is important we look at ways in which we can attract buyers such as young professionals to the town. If you live in one of the locations around Southport, such as Birkdale, they already have good amenities and often there isn’t enough of an incentive for people to come into the town centre. We need to change that.”
Chris’s agency covers Southport and a number of the outlying districts. He says that following the initial COVID-19 lockdown in March last year, Southport’s property market saw a surge in activity from people keen to buy residential property.
He explained: “When people were putting their properties on the market they were immediately getting four, five or six viewings. That has pushed prices up in the town and the icing on the cake was the stamp duty holiday.
“However, that is coming to an end in March so we will see what happens after that. Because of the pandemic there are a lot of problems in the economy. If we see a longer recession then I’m not sure how we could sustain a booming property market.
Chris believes the town needs more leisure attractions to bring more people into the town, both to visit and to live, and he is also supportive of the idea of diversifying its business base. He added: “We are a seaside town but we need more leisure attractions actually in the town.
“If we had a market quarter that would be a great spin-off to the shops. There are too many empty shop units in the town centre and I think we should look to attract more small businesses here. The idea of a hub for small digital businesses is a really good one – that would create a real buzz.”