After the economic crisis of 2008 and the subsequent economic meltdown that followed, prospects for the housing market were dim. However in the past year the property market has seen a resurgence that has taken many by surprise. House prices in London are now returning to their pre-2008 peak and many feel that they are being priced out of the London market.
With more and more buyers choosing to look further afield to commuter suburbs, some may think that there is nowhere left in London to buy an affordable home that will increase in value. However if you’re willing to do your research and explore parts of London that you may have previously overlooked there are still areas ripe for investment, where potential buyers can purchase a desirable property in an up and coming area without breaking the bank.
I spoke with Nick Marr from London based online estate agents - The Little House Company. He is a renowned property expert who has been in British Television to advice about the markets. Here are his top 4 picks for property hot-spots in London with a forecast to make money.
1. Ealing
Ealing has long been viewed as the typical inner-suburbia, attracting middle class families looking for the benefits and style of Chiswick and Hammersmith but without the price tag. Walking the streets of Ealing you come across a variety of independent retailers, from bakeries and book shops to cafes and bistros.
Its proximity to the BBC also means that you will most likely come across a film crew if you spend enough time roaming the streets, as it really is the perfect picture of an inner suburban, family friendly hub. A multitude of good schools, both state and independent, as well as a variety of stunning parks and green open spaces make this an exceptionally desirable area for families with young children, and owning a property within the catchment area of a sought-after primary will
instantly boost the value of your home.
It can seem at times that all transport lines end up in Ealing, and with the Central, District and Piccadilly lines all servicing Ealing Broadway station you can make it in to central London in well under half an hour. On top of the excellent bus and tube connections there is the imminent arrival of the Cross Rail connection, expected to be completed in 2018.
House Prices
The average house price in Ealing in March 2013 was £464,199. Compare that to £557,628 in March 2014 and we can see an annual increase of 20.1%, a huge change by anyone’s standards.
Detached houses are available from £850,00 and the most popular locations are the streets surrounding Pitzhanger Lane.
Jason Scott, Sales Manager at Kinleigh Folkard and Hayward, recently sold a 5 bedroom Victorian terrace for £900,000 and notes - “Up the road in Chiswick that would be £1.3m or so. I’ve worked in West London for 15 years and I can’t believe what good value Ealing is.”
2. Barnet
Barnet has long been viewed as providing the best of both worlds – the rolling fields of the countryside within reach of the hustle and bustle of inner London. It is certainly a borough of contrast when it comes to property, starting with the poky flats of North Finchley and going right up to the gated mansions of Hadley Wood. No matter your price range there is something for everyone here.
House Prices
The average house price in Barnet in March 2013 was £588,327, compare this to £648,330 in March 2014 and we can see an annual rise of 10.2%. Prices actually fell in the borough by 4% in the year up to June 2013 but this was most likely due to the wide range of stock and buyers in the market. Some argue that this depression has actually primed Barnet for larger rises than similar boroughs.
For buyers with budgets at the higher end of the spectrum, Hadley Wood is the place to be. Prices for Hadley mansions have risen steadily by 5% for years and that is unlikely to change in the near future, making these properties a pricey but stable investment.
For buyers looking at the lower end of the market there is real value for money to be found here. 3-4 bedroom Edwardian houses in West Finchley and Finchley Central can still be snapped up from around £450,000, which is an increasingly attractive option for families priced out of neighbouring Haringey.
3. Tower Hamlets
Tower Hamlets has always been seen as a bit of a mixed bag and has had to work hard to throw off its negative image of racial and cultural tension. Neighbouring Hackney has received much attention for its desirability and multitude of Victorian terraced properties. However prices are now high across much of the borough, with areas like Victoria Park Village fast becoming some of the most sought-after areas in all of London.
There is still good value for money to be found in Tower Hamlets however, and with prices set to increase even more in the coming years, it is quickly attracting savvy investors. The area is also attracting house hunters priced out of Hackney, who are drawn in by the low prices and trendy fashion hubs of Brick Lane and media hub Bethnal Green.
House Prices
The average house price for the borough in March 2013 was £420,727. In just a year this has risen to £560,581, an annual increase of 33.2% - one of the highest annual increases in London.
Wapping is an area of particular interest as house prices are estimated at roughly £750 per sq ft. Compare this to Shad Thames on the South side of the Embankment where you would expect to find an average of £1200 per sq ft and the value of Wapping is clear.
Potential buyers should consider the St George development on the old News International site as a sensible investment and desirable home.
4. Southwark
Southwark is an increasingly popular property hot-spot and has been named as one of the most lucrative areas for Buy-to-Let investments in the whole of London. HSBC found that landlords can expect an average 6.2% gross rental yield on property and there is high and constant demand for rental properties in the area. Interest in the area is being maintained by the much awaited redevelopment and regeneration of Elephant and Castle and the Cross Rail connection expected to arrive in 2018.
House Prices
The average house price in March 2013 was £452,635, compared to £523,894 in March 2014 – an increase of 15.7%.
Peckham is an area of particular interest within the borough. Peckham has experienced a recent influx of young creative professionals, attracted by the low prices and burgeoning artistic scene. The East London Line links Peckham’s 2 main stations, Peckham Rye and Queens Road Peckham, to Islington, Hackney and Hoxton amongst others making it even more accessible than ever before.
Jason Davis of Kinleigh Folkard and Hayward claims that prices on his patch have risen 30% in the past year and there has been a 70% increase in first time buyers compared to the same time last year. This is most likely because the area provides better value for money than neighbouring Dulwich, Camberwell and Brixton.
Franki Chaffin-Edwards
