THE BUYER'S EYE LONDON 2018 - Sourcing Investment Properties in London & Manchester - Allen Wargent
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AW BUYER’S EYE - LONDON 2018
Sourcing Investment Properties in London & Manchester
- THE BUYER’S EYE -
LONDON 2018
-1-AW BUYER’S EYE - LONDON 2018
- LONDON 2018 MARKET OUTLOOK -
In 2017, the London property market Stamp duty increases for individuals Nonetheless, opportunity still exists. And yet some relatively strong price
remained gripped in a cautious owning more than one property as Much of the market noise and growth was seen in some of the
mood as uncertainty around Brexit, well as tax deductibility changes headlines have been centred upon lowest price deciles of the London
inflation, and interest rates reduced also contributed to many investors the prime London boroughs such market, particularly earlier in the
transactional activity. watching from the sidelines. as Kensington & Chelsea, where year, partly driven by the distorting
some significant reductions in asking impact of the stamp duty bands.
prices have been witnessed.
- CURRENT ANNUAL GROWTH RATE BY PRICE BAND -
SOURCE: HOMETRACK
Rather than a slump for the Market investment fundamentals What we are likely to see is strong Therefore, we will continue to see a
prime central markets, it can very remain stable and consistent, ongoing demand for well-located diverse buyer market and continued
strongly be argued that this is a with stock levels low, new supply and well-maintained properties that activity from those looking to invest
readjustment, following several years remaining constrained, and rental meet the rental criteria of young for the long term.
of growth out pacing the rest of market demand for the right product professionals and families.
London. robust. Post Brexit, many commentators
However, for secondary properties believe the UK will return to its
The weaker currency has acted as a London boroughs that continue or those that require a little more strengths as the uncertainty lifts.
buffer against more significant price to offer value and connectivity, will maintenance or attention, demand
declines. continue to thrive amongst the will likely be patchier. Should the UK government also
first-time buyer and family buyer negotiate a favourable Brexit, it is
Indeed, for many non-sterling cohorts, with east and south-east For investors that can move quickly, likely demand will increase rapidly as
domiciled investors, investing in London continuing to flourish and this could present opportunities investors seek to invest unallocated
London property remains attractive new infrastructure such as Crossrail when negotiating prices. capital.
going into 2018, especially as the and the London Bridge station
Pound stays weak around Brexit redevelopment coming online. While 2018 will remain another
uncertainty. underpinned by caution, many
London homebuyers and investors
remain cash rich, and the
fundamentals of London property
remain strong.
-2-AW BUYER’S EYE - LONDON 2018
- SPECIAL BOROUGH REPORT – GREENWICH 2018 -
The London property market is In terms of ‘where next?’, south Aside from the new Greenwich Over the last few years the
constructed from many micro- east London is seeing a significant is also one of London’s most gentrification has become clear, with
markets. revival - we see increasing historic boroughs, with the Royal shops along the Trafalgar Road
infrastructure investment, not only Observatory providing spectacular, converting from various takeaways to
Over the past decade many in public transport, but also road panoramic views across London, the artisan cafes, vintage clothing stores,
boroughs considered to be prime networks, and community space. Maritime Museum and Royal Naval mobile phone shops, and even a
central London (over £1,000 per College showcasing London’s naval boutique wine shop which holds
square foot) have seen prices grow, Areas such as Peckham, Deptford, heritage. The recently refurbished regular tastings!
with a number of areas across zone and Lewisham have seen huge Greenwich market and Cutty Sark
2 (TLF Travel Zones) well above this inward investment in the last 5 to 10 ship attracts visitors from around the Schooling in the area is also well
threshold. years, which have result in increased world. provided for, with a number of
housing starts and inward population popular primary schools and high
Indeed, some individual pockets movement as buyers seek value and This is in addition for some of achieving secondary schools in the
including Battersea and Camden convenience across the capital. the finest green space in Central locality. A new doctor’s surgery and
have seen prices move above London, right on your doorstep. leisure centre and complex opened
£2,000 per square foot in recent With close proximity to the green In terms of property, Greenwich in 2015, providing a new library and
years. areas of Greenwich and Blackheath Centre is considered to be prime sports complex, including swimming
as well as the River Thames, south real estate, with its historic pools.
With London also benefiting east London is see as a robust townhouses and cottages.
from significant infrastructure location to invest in, where capital This area is popular not only with
investment, including Crossrail values have not yet reached the However, walking west out of young families but also professional
and the London Overground level seen in similar areas of south Greenwich along the Trafalgar Road couples looking to enjoy a more
Network, London is becoming more west London, such as Clapham, and parallel to the River Thames, relaxed pace of life while remaining
accessible. Wandsworth, and Wimbledon. you reach the areas Maze Hill and in the city. Young professionals also
Westcombe Park, which lie on the enjoy the benefit of a good work-life
And as the population seeks value, Focusing on Greenwich and its northern elevation of Greenwich, and balance, with excellent transport
previously less desirable areas are surrounds, the area is seeing one are packed with tree lined streets links to the City.
now seeing a resurgence. of the largest pieces of urban and low rise houses, many of which
regeneration in Europe on the remain family homes and others Additionally, the proximity of the
Across London, it is not uncommon Greenwich peninsula, with over of which have been converted into Queen Elizabeth II hospital makes
to see a mix of new train stations 15,000 new homes planned on a apartments. Greenwich a popular location for
and increasing housing construction 300-acre site. medical and other public services
activity, leading to more professional Both areas are well served by the workers.
and families moving into these Building has already commenced SouthEastern railway, reaching
locations, with a markets change in with developments such as London Bridge in under 15 minutes, These areas are unquestionably
local services and amenities. Greenwich Millennium Village and also stopping at London growing in popularity, and still
now complete, and residents being Charing Cross since the end of provide value when compared to
Areas such as Stoke Newington, connected to the West End of summer 2016. similar areas in south west and
Hackney, and Streatham have seen London in only 20 minutes, Canary north London. With prices still below
this gentrification take place over Wharf in less than 5 minutes, and Train services will also be improving £1000 per square foot, Greenwich
the past few years, with demand Westfield Stratford in 10 minutes, all post summer 2018 when the and surrounds provide attractive
for family houses in particular via the Jubilee Tube line. London Bridge station refurbishment options for investors looking to
outstripping supply. is completed, with regular services attain a slice of the capital’s ongoing
Since 2017 the Jubilee line has also to the City and West End. growth.
This demand is also driven by been running 24 hours per day, 7
‘Generation Y’, who are shunning days per week, a first for London. Both Maze Hill and Westcombe
the traditional flight to the suburbs Park are within walking distance of
and opting to stay in the city even as The peninsula itself is also home the River Thames and Blackheath,
they start families, finding themselves to the O2 Arena, one of the UK’s providing residents with an escape
both asset and cash rich from the largest entertainment complexes, from the hustle of city life. The area
price increases in London over the hosting regular arena events is well served with historic pubs,
past 10 years. and housing a huge complex of restaurants, and independent shops,
restaurants, bars, and cinemas. whilst also being a short distance
from larger supermarkets.
-3-AW BUYER’S EYE - LONDON 2018
- CASE STUDY: VICTORIAN TERRACE -
The Greenwich peninsula could see Buyers with the requisite budget
a dramatic redevelopment over the often look towards housing stock
years ahead. that can’t easily be replaced, such as
the classic Victorian terrace.
While the specific final plans for
the huge chunk of land across the In the quieter and more desirable
water from Canary Wharf are as yet streets, quality 3-bedroom terraces
unconfirmed, it seems likely that tend to be priced from around
large, new apartment buildings will £600,000 to £1 million, and
feature alongside new office space. upwards of that for the premium
grade homes with 4 or more
bedrooms.
Vacancy rates for quality examples of Thus, a £700,000 home might
this property type continue to track be expected to rent for around
at very low levels, and the tight rental £2,000pcm if it is well presented for
market is expected to endure due to the rental market.
the inherent scarcity.
AllenWargent expects homes in
A typical gross rental yield for this the most sought after primary school
type of property might be in the zones to outperform in terms of
region of 3.5pc. capital growth.
-4-AW BUYER’S EYE - LONDON 2018
- PROPERTY INVESTMENT SELF-EVALUATION -
1 - Strongly disagree 2 - Disagree 3 - Neutral 4 - Agree 5 - Strongly agree
I am happy with my current investment portfolio.
1 2 3 4 5
I have a robust, long term plan for my investment portfolio.
1 2 3 4 5
I believe that I am maximising the returns on my income.
1 2 3 4 5
My investment plan is tax effective.
1 2 3 4 5
I am leveraging my time and income effectively.
1 2 3 4 5
If you scored 20 or under, please get in touch with us, and we may be able to help.
-5-AW BUYER’S EYE - LONDON 2018
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