Steel City: Sheffield, the UK’s next top investment location

December 11, 2025

Historically known as the “Steel City” due to its industrial past, Sheffield is now known as the “greenest city” in the UK. With the Peak District National Park on its doorstep, Sheffield is rapidly becoming one of the UK's top investment locations.

Driven by an impressive economic forecast alongside several major regeneration projects across the city, worth more than £1 billion, the region's demand for modern city living is growing, and house and rental prices in the city have been increasing over the last year.

‍

Property market

The Sheffield housing market has shown consistent growth over the last few years, marked by rising house prices, increasing rental demand, and significant investment in the city’s infrastructure. House prices have shown steady growth, with an average house price of £221,000 in January 2025, up 6.7% from 2024. By comparison, the national average house price is £270,000, making Sheffield an attractive and affordable option for buyers.

The rental market is also thriving with a demographic of young professionals, students and families. Private rents rose to an average of £877 in February 2025, an annual increase of 6.4% from £824 in February 2024. This was higher than the rise in the rest of Yorkshire and the Humber (4.8%) over the year.

Its affordability, coupled with strong rental yields, makes it an appealing market for investors. With average house prices lower than nearby cities such as Leeds (£244,000) and Manchester (£265,000), Sheffield offers excellent value for money.

‍

Regeneration

Sheffield city centre and the surrounding region are currently undergoing transformation with over £1 billion worth of regeneration.

The council's major project is The Heart of the City scheme, where £470m has been injected to improve the city's centre. As one of the largest urban regeneration schemes in Britain, this ambitious project will help to drive the economy and deliver a new avenue for retailers, food, drink and leisure. Alongside this, a mix of 420 new homes and 500,000sq ft of working space will be created.

Beyond this, several other developments across the city are underway to transform the cityscape and offer more growth. The “connecting the city centre” project aims to make the city centre a more attractive location for residents and visitors. This initiative will create new green spaces and make the city more walkable and bike-friendly.

‍

‍Local economy ‍

The region's economy is thriving and has a proven track record of attracting investment and talent. Sheffield was once an industrial powerhouse; now the city is redefined. Public services, advanced engineering and manufacturing, alongside multiple innovation assets, currently account for a large portion of the city's economy.

Globally renowned companies such as Boeing, Rolls-Royce and McLaren are collaborating with local businesses on research and development projects, which are attracting a highly skilled workforce to the city.

Sheffield is also home to two world-class universities: the University of Sheffield, which currently ranks 15th in the UK and 92nd globally and Sheffield Hallam University, which consistently ranks in the top 100 universities in the UK. These institutions attract students from both national and international backgrounds, with an estimated 40% retention rate, highlighting the city's ongoing appeal and its ability to retain talent.

Why invest in Sheffield ‍

Sheffield offers great affordability for investors and buyers. The property market is on the rise, but entry levels are lower than in surrounding cities like Manchester. Rents are also rising, with demand for city centre living increasing.

Major regeneration is taking place throughout the city to improve the quality of life and create new avenues for entertainment. These projects are elevating Sheffield into a modern and highly desirable location where supply can not keep up with demand.

If you want to be a part of Sheffield's success and want to invest, visit our website today and contact one of our team members who can advise you on our developments and help you make the right choice.

Steel City: Sheffield, the UK’s next top investment location

You may also be interested in...

Will residential property outperform commercial property in 2026?

Property Market Focus: The North West

What makes Build to Rent (BTR) so appealing to funds – and why does it matter?