Property prices in London rose a great deal in the first half of 2014 before dropping off slightly towards the end.
The average price rise in prime properties worked out at around £260 per day, but demand has shifted from central city locations to zone 3. The shift is because prices in the outer prime market are lower and leave more room for growth and profit in the future, particularly when new transport links are finished. Traditionally sought-after areas like Kensington, Chelsea and Westminster will remain strong, but forward thinking investors are already looking for new hotspots for the years ahead.
A few years ago, zone 3 was the area for first time buyers, young professionals and students because it offered so much value compared to more centralised locations. With demand pushing prices in central London higher last year investors were forced to look further afield for properties that met their budget and needs. Many of these would be found in zone 3, leading to several new developments and more competition in the area.
Over the next four years property experts Savills expect homes in zone 3 to increase in value by around 22.7%. First time buyers still target the area but this may see a shift towards investors snapping up homes as they look for properties they can let and wait for values to rise. In central London rents are sky high and price many people out of the market. This means there is more demand for homes outside of these areas that can be bought and offered as affordable rentals.
There are many new developments under way in popular parts of zone 3 to increase the availability of housing because there is so much demand. Several projects see properties sold before they are even completed because people need to get in so early to beat the competition. One example is Bellway’s development in Brentford which has seen homes sold a full year before they are due to be finished and ready for occupancy.
Eagle eyed investors will be looking for areas in zone 3 that will become new popular locations and deliver the most profit in the coming years. If you need help looking at the market and deciding where your money is best you can call on us for advice at any time. We offer a wide range of investor services, including portfolio management, and can adivse you on all aspects of property investment in Camden and throughout the rest of London.