The recent COP26 event has left us with environmental concerns at the forefront of our minds – but for those of us constantly looking for the next lucrative investment, this renewed focus on clean technology is an opportunity to reflect on how green initiatives could present golden opportunities.
In particular, it’s worth thinking about the investments that have been promised as part of COP26 – especially by large financial entities. One of the cornerstones of the COP26 agreement was, for example, that financial institutions should direct finance towards clean technology like renewable energy.
Investments like this will inevitably have knock-on effects for local economies, producing better jobs, contributing to renewal and rejuvenation schemes, and – by extension – increasing property values.
As such, identifying the places in which such projects are being financed is a strong way to spot investment opportunities – and the North of England immediately suggests itself as an area brimming with the potential for green investment.
Such was the conclusion, at any rate, of a recent report from the North-East England Chamber of Commerce, which calls on the Department for Business, Energy, and Industrial Strategy to bolster the region’s switch to greener energy production and capitalise on what the Chamber’s assistant director of policy, Rachel Anderson, describes as “an unrivalled base on which to build a global energy sector right across our region.”
Reflecting on this “unrivalled base” in light of COP26, then, is a fresh way to determine which way the investment winds are blowing, signalling to investors that this region may well be a lucrative option.
Green initiatives and low carbon economies
The North-East England Chamber of Commerce isn’t the only organisation that’s noticed the significant economic possibilities of green technology investment for the North.
According to The Market Spotlight report from Bruntwood SciTech, the UK’s commitment to net zero more broadly will result in the creation of 365,000 jobs – with the North-West of England seeing disproportionately high economic benefits, in addition to Yorkshire.
Similar projections have been offered by the Local Government Association, which predicts an even higher 1.18 million new jobs in the low carbon sector by 2050, with the largest increases in such work to be found – sure enough – in the North-East and Yorkshire and the Humber.
Of course, while investors will want to keep an eye on predictions and projections, these developments in the North aren’t just hypothetical: they’re happening now.
In October, for example, it was announced that the government has chosen two northern sites as the locations for multi-billion pound projects designed to cut carbon.
In both Liverpool Bay and the Humber and Teeside, we’re seeing the rise of the East Coast Cluster and Hynet respectively. These unique green undertakings are designed to capture carbon emissions – with the added side effect of acting as considerable boosts to the Northern economy writ large.
Figures from the East Coast Cluster website suggest that the project will achieve over £2 billion in gross value added by 2050, while Hynet predicts a contribution to the North-West economy to the tune of £17 billion in the same period.
These are significant economic boosts which are likely to have positive effects on the Northern economy as a whole.
Investing in Northern properties
Taking as read, then, the fact that the Northern economy stands to be further stimulated by green initiatives, the question remains: how can investors best capitalise on this promising situation?
Given the long-term implications of these clean energy projects, it follows that property – a similarly long-term undertaking – is a sensible way to invest in the region. Improved job creation, heavy investment, and a good flow of money in the northern economy are all factors likely to increase property values.
After all, some of the factors discussed above take us all the way to 2050 – and this kind of forward thinking is best combined with the reliability of bricks and mortar.
Of course, though these intriguing long-term projections are enough to mark out the North as a good area for investment, we don’t need to wait 30 years to see the region’s property values rise.
In fact, in 2022 alone, the region – according to premium estate agent Strutt and Parker – could see price rises of 7 per cent.
Looking ahead to the next four years, meanwhile, growth is also expected to the tune of a 35 per cent rise in property values, as the region’s historic affordability leaves its properties considerable amounts of space to continue growing.
Lasting value from long-term investments
Although the pandemic may have initially spurred on this desire to buy more spacious homes in less urban areas (which the north provides in abundance) this trend may well be irrevocable, extending beyond the pandemic itself.
If nothing else, the majority of members of the Royal Institution of Chartered Surveyors believe prices will continue to rise over the next year purely due to scarcity relative to demand.
This means that the factors which contribute to the North’s continued property value growth aren’t necessarily disappearing any time soon – even as the investments represented by green initiatives and other ‘levelling up’ endeavours strengthen the economies in which such properties exist.