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WHERE TO INVEST IN PROPERTY IN 2015

Where is the best place to invest in property this year? The half-a-million pound question – The Resident asks London’s top agents where it would be best to invest in property in 2015

Tim van der Schyff of John D Wood & Co.

Investing £500,000 in Streatham and Tooting will buy you a much larger property

 ‘You could argue that it is better to buy a smaller property in a better location. In areas such as the Kensington & Chelsea, Westminster and Hammersmith & Fulham, property is always in demand and you’re likely to see a fairly instant rise in capital growth. However, £500,000 won’t stretch far – you would be able to buy a small one-bedroom flat or studio.

‘The second option is to follow the ripple effect of people moving further into Zone 3, to areas such as Streatham and Tooting. Investing £500,000 here will buy you a much larger property, maybe a top-floor or garden flat with potential to be developed further down the line. These areas won’t give you an instant hit in capital growth but are likely to grow in value in the long term.’

Where to invest in property in 2015

Bayswater is on the up

Sam Allport of Mountgrange Heritage

Bayswater is on the up with the re-development of Queensway and work on turning many of the handsome old hotels into stylish apartments

‘You’d be lucky to find anything decent in Notting Hill for half a million, but look slightly to the east where W11 turns into W2 and you may find yourself a gem. Bayswater is on the up with the re-development of Queensway and work on turning many of the handsome old hotels into stylish apartments. We have just sold a studio apartment on Leinster Square, W2 for 495,000. It was owned by our client for many years and rented out for £1,625 a month – a gross yield of nearly 4%. It turned out to be a great investment with fantastic capital appreciation over the past few years. Whilst we don’t expect prices to rise as steeply in the coming years, there is still great scope for appreciation as this area continues to improve. There are some fantastic period properties with the added benefit of being on the doorstep to attractions such as Kensington Gardens, Portobello Road and Westbourne Grove.’

Where to invest in property in 2015

Look to Canary Wharf’s exciting developments for good investment opportunities

Cory Askew of Chestertons

One of the most exciting projects is Wood Wharf (Canary Wharf). Not only is the development estimated to feature 3,600 homes, 25% of these will be affordable homes

‘One of the most exciting projects is Wood Wharf (Canary Wharf). Not only is the development estimated to feature 3,600 homes, 25% of these will be affordable homes. Further negotiations may see this number rise up to 40%, making the area more accessible to first-time buyers and young families. 2014 has been a very strong year with property prices rising by 20%. We expect prices to continue to grow consistently throughout the year as savvy buyers continue to seek value outside of Prime Central London.’

Where to invest in property in 2015

You can still get good value for money in Blackheath

James Hyman of Cluttons

I would recommend looking at Blackheath, where you can still pick up an attractive two-bedroom period conversion flat averaging between £700–900/sqft

‘£500,000 doesn’t buy much in PCL, so I would recommend looking at Blackheath, where you can still pick up an attractive two-bedroom period conversion flat averaging between £700–900/sqft on a nice road and within a 10-minute walk of the station. Blackheath offers the best of city and country life with excellent schools, community spirit, local amenities and leisure opportunities. It’s easily accessible from Central London, Canary Wharf and Charing Cross. It has the potential to grow 8% over the next three years, compared to 2% in PCL, enabling buyers to get ahead of the market.’

Where to invest in property in 2015

Brixton gives you better value for money than other SW London areas

Mark Hutton of Douglas & Gordon

£500,000 in Brixton is likely to pick up a small two-bed flat and in Tooting something a bit larger

‘It is possible to buy relatively near to Chelsea and on the Fulham fringes, but with £500,000 it’s unlikely that you’ll secure more than a one-bed, although such properties can command a good rent. However, if you look further afield at the emerging areas of Tooting and Brixton you will find better value for money and greater capital growth potential. With Tooting you are buying into Wandsworth – a smart borough, so you’ll automatically benefit from the established infrastructure. Brixton straddles the fringes of the Battersea Nine Elms redevelopment so is set to piggy-back on the wider regeneration and investment. £500,000 in Brixton is likely to pick up a small two-bed flat and in Tooting something a bit larger, but both are likely to offer the opportunity to extend into the loft or side return, whereas many surrounding areas have already reached their extension potential. Expect to see 25-30% house price growth in Brixton and Tooting in the next three to five years, making both a lucrative investment.’

Where to invest in property in 2015

Brook Green is near the many attractions of Hammersmith

Dean Moriarty of Savills

Brook Green is an ideal location to spend £500,000 in London

‘With excellent transport links into central London and out to the west, Brook Green is an ideal location to spend £500,000 in London. The area is equidistant to Hammersmith and Shepherd’s Bush and thus benefits from five underground stations and one overground. It is popular with young professionals and the rental market is excellent. In an area where we expect to see a strong growth of almost 23% over the next five years, it is well worth buying a good one-bed flat here for a solid investment that will look after itself and promise a solid return.’

Where to invest in property in 2015

Buy a two-bedroom flat for £500,000 in Streatham

David Jubb of Savills Greater London Development and Sales

Streatham Park provides two-bed flats for under £500,000, surrounded by leisure, culture and open spaces

‘It is worth maximising your expenditure by investing in an up and coming area where development and regeneration promises strong growth in value. Streatham Park provides two-bed flats for under £500,000, surrounded by leisure, culture and open spaces. This area is currently a spotlight for regeneration, with another residential development in the pipeline as well as new retail propositions and we expect the area to experience strong growth over the coming years. Sitting behind Balham, which in the past few years has transformed into a vibrant and popular location for families and young professionals alike, Streatham has a promising future and is somewhere to invest in now.’

Where to invest in property in 2015

Herne Hill is a very attractive option for potential buyers

Lucian Cook, Savills UK Head of Residential Research

Look at emerging areas such as Acton, Herne Hill, Kensal Green and Kilburn

‘The London housing market has outperformed the rest of the UK for over nine years meaning that it has much less capacity for price growth than the rest of the country. Those investing in the capital are likely to be looking for areas where some latent value is likely to be unlocked, as they open up to more affluent buyers. That would suggest looking to emerging areas such as Acton, Herne Hill, Kensal Green and Kilburn, though a £500,000 cash investment may need to be backed by some mortgage debt.’

Where to invest in property in 2015

Look to Zone 2 and 3 like Tooting for investments

Stephanie McMahon, Head of Research at Strutt & Parker

We are predicting 0% growth for Prime Central London house prices in 2015, but expect price growth in the greater London suburbs to be much higher at 9%

‘As central London has become increasingly expensive, young workers have moved beyond their traditional Zone 2 haunts in order to buy their first properties. Although the ‘buzz’ of some Zone 3 and 4 locations is not yet able to compete, we can expect retailers, restaurants, cafés and bars to follow the trend and create new enclaves in the wider London market. We are predicting 0% growth for Prime Central London house prices in 2015, but expect price growth in the greater London suburbs to be much higher at 9%, fuelled by buy-to-let investors and young Londoners looking to the outskirts in order to get a foothold on the ladder in the capital.’

Ash Griffiths at Strutt & Parker Greater London Residential Development

Locations that are likely to show some of the best potential are Barking to the east, Hackbridge (near Carshalton) to the south, Seven Sisters to the north and Old Oak Common (in Acton) to the west

‘We expect to see the most growth over the next few years in Zones 3 to 6. Locations that are likely to show some of the best potential are Barking to the east, Hackbridge (near Carshalton) to the south, Seven Sisters to the north and Old Oak Common (in Acton) to the west. Each of these areas is currently underdeveloped and overpopulated, with fantastic transport links and more amenities planned for the future. When looking at the average flat price in Old Oak Common, around £340k, this type of property has shown 30% growth since 2007 when Crossrail was announced. The average-priced house in Seven Sisters, around £440k, has shown 34% growth since 2007. Both of these districts would make a sound investment for someone with under £500k to spend in the capital this year.’

Where to invest in property in 2015

£1m still goes far in North Kensington

Andrew Phillips, Head of Central London Sales at Hamptons International

Look to locations such as North Kensington and Portobello Square, which represent ‘value for money’ areas

‘It is a myth to say that you can’t buy an investment property in central London for up to £500,000. Look to locations such as North Kensington and Portobello Square, which represent ‘value for money’ areas where sub-£1m investment can still go a long way. Other even more central locations such as Pimlico and Westminster offer investment opportunities at a similar price point and you’d also bag a coveted prime central London address.’ 

 

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