Fans of the Magpies continue to bite their nails this week as the club’s Saudi takeover, reported to be worth £300m, is still yet to be given the green light after weeks of uncertainty.
The deal could make Newcastle one of the richest clubs in the world and fans will be hoping a return to the top tier of the Premier League will soon follow as a result.
But what could it mean for the local property market?
Local property developer, StripeHomes, has released research looking at 20 previous Prem takeovers and what happened to local house prices in the years following.
The research shows that on average, house prices in towns or cities to benefit from a big name takeover increased by a buoyant 5% in the year following, climbing to 15% over three years.
With the average house price in Newcastle currently at £159,722, a similar boost as a result of the Saudi deal could see this climb to £167,711 over the next 12 months, hitting £184,062 in just three years.
This price increase, could however, climb even higher.
In the year following Tottenham Hotspur’s takeover by Joe Lewis in 2001 house prices increased by 19%. After Joshua Harris took over Crystal Palace in 2015 local house prices climbed by 16%, with a 10% increase in local market values when Abramovich took the helm at Chelsea.
But this double digit price growth isn’t restricted to London. When Tony Bloom became the majority owner at Brighton, house prices in the local area climbed 13% in the city. After the Glazers took over at Man United, there was also a 10% uplift. Bournemouth, Norwich and Sheffield also saw increases of between 6%-8% following their respective takeovers.
Looking at the data over the three years following each takeover, Tottenham, Arsenal, Watford, Norwich, Chelsea, Bournemouth and Crystal Palace all saw house price increases in excess of 20%.
However, a local property market boost isn’t guaranteed and Leicester, Liverpool, Newcastle and Man City all saw prices decline in the year following their last takeover, while Newcastle, Liverpool and Man City have also seen a decline over the three years following.
Managing Director of StripeHomes, born and bred Geordie and lifetime Newcastle fan, James Forrester, commented:
“If it does come off, this latest deal should put the club back where it belongs and bring a much wider benefit to the local economy and housing market.
Mike Ashley may not be the most popular man in Newcastle but he is a business man at the end of the day. So it’s no surprise that any wider economic benefit has been slim since he took over Newcastle as the club has been run on spreadsheet analysis rather than with a passion for football and the local community.
What we really need is the return of that feel good factor on match days, the atmosphere that fills the pubs, clubs and restaurants in the city. It’s this buzz that makes Newcastle and we can’t underestimate how important it is for the club and how it filters down through the community to all areas of the local economy.
Hopefully, it will make Newcastle the footballing destination it once was and this boost will increase demand for housing and see prices increase as a result.”
