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Walk through Cardiff’s pedestrianised streets on a summer’s day, when the pristine castle looks more like a film set than usual and the tables outside the restaurants are full of office workers, and it is easy to believe predictions that the city is on the cusp of an economic upturn. It is certainly due for one, for the Welsh capital fared badly in the recession.
In 2008, unemployment doubled to 10,000, having hovered at about 5,000 for the previous eight years, and some sectors of the property market crumbled. New housebuilding came to a halt and many half-finished developments were mothballed. According to the National House-Building Council, the number of planning applications in the Welsh capital fell by 70 per cent, and Savills estimates that house prices dropped by between 28 and 30 per cent.
Yet before the financial crash Cardiff was riding high – placed seventh in the top 50 European cities by the fDi magazine, owned by the Financial Times, with the city reaping the benefits of major financial services companies, such as Legal & General, HBOS and Zurich, having national or regional headquarters in the city. It had also developed a reputation for staging major events at the Millennium Stadium and had become home to the Welsh media.
Now it is hoped that the city can recapture those good years. Cardiff Council foresees an influx of about 58,000 people by 2026. “We are planning a major expansion,” says Ken Poole, the council’s head of economic development. “Cardiff matches the McKinsey Global Institute’s profile of a so-called ‘middleweight’ city, likely to contribute heavily to global growth in the future. We are a great alternative for companies moving out of London. Median salary costs in the financial sector here are 20 per cent below London’s; there is a huge pool of skilled labour and Grade-A office space rents at £21 per sq ft, compared with £55 per sq ft in London. On top of which, the planned electrification of the railway [scheduled for 2018] will mean we are less than two hours from London.”
The council estimates that 38,000 new homes need to be built for the expected influx of people. What form those homes should take and where they should be built, however, is a source of concern. Already one local development plan has been rejected by the Welsh government, partly because it was too heavily weighted with apartments. A new plan, which is not without its detractors, will see more family homes being built on greenfield sites in the city. “A very high percentage of Cardiff is green space – a hangover from its Victorian past,” says Poole. “The city can easily absorb this amount of housing.”
According to Savills, the local property market is already recovering from its paralysis of 2008. “Building has restarted in Cardiff Bay and investors, disappointed by the poor returns from the banks, are reappearing in the buy-to-let market,” says Peter Reilly, head of residential at Savills. “[Investors] can buy a two-bed apartment with a water view for £240,000 and let it for around £1,000 a month. A flat with a less pleasant outlook can be bought for £160,000 and that will let for around £650 a month.”
Cardiff has some pleasant, leafy areas. Pontcanna, a favourite with young arts and media people, has an attractive café culture and is a pleasant walk from the city centre, via the park and the river. A four-bedroom Victorian house there will sell for between £375,000 and £500,000. Whitchurch, with its busy High Street, has good amenities and schools. Roath is a student area not to be confused with Roath Park, which has some very substantial Edwardian homes, well-placed for popular Cardiff High School – rated “excellent” by Welsh education inspectorate, Estyn.
To the north of Cardiff is Llandaff, where Jeff Hopkins estate agents is selling a four-bedroom family home for £500,000. On the other side of the city is another prosperous suburb, Lisvane, which has become something of a phenomenon in recent years.
With its views over the city and village feel, Lisvane is the most expensive place in South Wales. The average price of a house sold there over the past year was £416,362 according to Zoopla. The grandest houses sell for more than £1.5m; while £800,000 for a four-bedroom detached house is standard. The Mount is a five-bedroom, extensively renovated home, dating from 1895, with 9,300 sq ft of internal space. It has 10 acres of grounds and is on sale with Savills for £2m.
Rather than building new homes in Cardiff’s more desirable areas, an alternative would be to build them in the commuter belt. “There should be more cohesion between Cardiff and its regional hinterland,” says Kevin Morgan, a professor at Cardiff University and adviser to Edwina Hart, minister for economy, science and transport in the Welsh government. “It would be more sensible to split the new housing between the city itself and nearby places such as Caerphilly and Llantrisant,” he adds.
One drawback to Morgan’s suggestion would be that the Vale of Glamorgan, an attractive rural area bordering the coast to the west of Cardiff, could be encroached upon by urban sprawl. At present the vale is very popular with Cardiff’s high-fliers. “Buyers come here for the semirural lifestyle and for the schools – both the lovely little village primaries and the spanking new comprehensive at Cowbridge,” says Rhys Cory Gould, head of residential at Watts and Morgan.
Penarth, only five miles outside the city centre, is popular with young families who are attracted by its sturdy, Victorian terraced homes which sell for £400,000. Villages such as Bonvilston, Colwinston and Peterston-super-Ely have a Devonian flavour and Cowbridge is a thriving market town. Pentwyn House, in Pendoylan, is a four-bedroom Edwardian house on sale for £575,000 with Watts and Morgan.
Once approved, the council’s development plans will be put into action in October 2015, creating a framework for growth for the next 11 years that, by accommodating the expected influx of well-qualified newcomers, may help drive Cardiff’s economic renaissance.
● Cardiff has more green space per person than any other UK city
● The city has the highest recorded crime rate in Wales
● Average train journeys to London Paddington take just over two hours
What you can buy for . . .
£500,000 A newly built four-bedroom town house in Pontcanna
£1m A five-bedroom detached house in a suburb of Llandaff
£2m A seven-bedroom house with an outdoor swimming pool in Lisvane