In this second part of our two-part series on Cornwall (click to read part 1), we will examine the current economic and property market performance, future redevelopments and regenerations, and the strength of buy-to-let in Cornwall districts. Our first instalment focused on Cornwall's rich history, heritage, and attractions, as well as why it is one of the finest tourist attractions in the UK due to the monuments and architecture developed throughout the ages. Cornwall is a county in the southwest of the United Kingdom noted for its beaches, which are recognised globally as its main attraction, making it one of the top surfing destinations.
Cornwall's economy is dominated by agriculture and tourism. According to the ONS, it is the UK's fourth least productive region in terms of the amount of value generated by individual workers. However, in terms of unemployment, Cornwall outperforms the UK average. During the COVID-19 pandemic, Cornwall's unemployment rate was estimated to be 4%, which was just 0.6% lower than the average UK unemployment rate at the time. Cornwall's job sector distinctions are primarily centred on hospitality, health, and social care. This county lacks a strong presence in the research and technology sectors. Cornwall's tourist attractions and holiday reservations benefit from a substantial emphasis on hospitality services.
Cornwall has a high demand for holiday homes. It has long been a famous UK tourist destination due to its panoramic beaches and magnificent clifftops. However, recent developments indicate that Cornwall may be shifting away from its reliance on tourism and toward new businesses that will give new job possibilities and higher pay. The G7 summit is hoping to be a catalyst in providing this boost to the working economy with Kim Conchie, chief executive of Cornwall Chamber of Commerce, stating "the sectors and industries we are trying to promote fit with that, things like renewable energy, agriculture technology, marine tech and creative sectors". Cornwall has already attracted inward investment, which has resulted in the creation of new job opportunities.
Cornwall has recently seen a number of redevelopment projects or new developments. Former Prime Minister Boris Johnson made the most notable announcement. In April 2021, he announced a multi-million pound investment in Truro to promote the local economy, create employment, and increase local skills to help the county recover from the COVID-19 pandemic. This £23.6 million project aims to turn Cornwall's capital into a connected river city, supporting the county's objective of becoming a modern economic, cultural, and green capital for its people and the wider community by 2030. By converting some of the historic buildings into thriving businesses, this investment will help improve cultural and tourism attractions. This financing will also assist in the conversion of some of Truro's vacant structures into new residences.
In September, the government announced the first £18.3 million of the £88.7 million town deal to deliver regeneration plans, revitalise town centres, and improve connectivity in four Cornish areas. This is the first instalment of the town deal, and it will support over 30 regeneration projects across four towns by March 2026, distributed to a range of private, public, and voluntary organisations. Each of the four towns has its own goals for utilising the funding. Truro will focus on improving its assets and connecting to the river. Penzance and Newlyn are striving to diversify their economies and provide crucial sustainability. St Ives aspires to provide new long-term possibilities for its residents and to assist the economy's growth on an annual basis. Finally, Camborne will strive to improve the environment around the town while also providing additional health, learning, leisure, and employment options for its citizens.
These plans aim to boost Cornwall's tourism presence not only in the UK but throughout Europe, as well as open doors to new job opportunities with the development of several working sectors in the pipeline. Cornwall's economic growth over the next 4-8 years is something to watch.
Cornwall's property market appears to be in good shape right now. According to Zoopla, house prices are up 9.5% higher than in August 2021. Market transactions have moved faster in the last five years than they did previously, with a house being under offer 29 days after it was listed. Normally, this would take 33 days. There are a variety of properties available in Cornwall with varying letting market values. According to Cornwall Live, there are 523 properties available to rent in Cornwall as of December 13th, with an overall average cost of £1,118 per month.
Since 2019, the demand for Cornwall property has skyrocketed. According to OnTheMarket, sales enquiries for Cornwall houses climbed by 67% between 2019 and 2021. This had an effect on property values, as sought-after residences saw price increases of 20-25% when the housing market reopened during the lockdown in May 2020. Another survey found that house prices in Cornwall are rising at a rate of more than £100 per day. According to the ONS, the average property price in Cornwall increased from £265,481 to £305,969 between March 2021 and March 2022, a rise of £111 per day. The price increase is expected to continue beyond 2023 as demand for property in tourist areas grows tremendously. The idea of buy-to-let for investors is particularly appealing due to the year-on-year increase in house prices, as the average monthly cost of rent will move in unison with property price increases.
Cornwall's economy is poised for a healthy boost in the next years as a result of exciting regeneration projects aimed at increasing the range of jobs and institutions. The county's historic heritage and tourism are stronger than ever and continue to flourish, allowing Cornwall to cement its status as one of the best places to visit or live in the UK. The housing market will benefit from the economic boost as well as organic growth, making investing in Cornwall property a wise decision for many investors.
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