6th November 2015
London property prices rise by £5 an hour as Ilford emerges as new city hotspot
by Charly of www.abpropertymarketing.co.uk
London property value increasing by £5 per hour (Land Registry)
Ilford property prices tipped by rise by 40.7% by 2020 (JLL)
Average property investment yields up 2.7% over the past year (ONS)
Whilst property prices across the UK are known to be rising, in some cases sharply, the highly profitable bubble that is the London market has been highlighted with the release of new data. The Land Registry has revealed that properties in London are increasing in value by a mammoth £5 per hour, providing investors with an impressive income stream.
With interest rates on many forms of savings at a record low, the attraction of making £5 every waking hour (plus £40 or so while you sleep) are not to being ignored by many savvy buyers. But is the pace of the market sustainable?
Jonathan Stephens, Managing Director of Surrenden Invest, a London-based property consultancy specialising in high yielding buy-to-let investments, believes so. He explains,
“London is such a demand-driven market that it operates almost entirely independently of anywhere else in the UK. There’s a lack of physical space for new build properties and those that are being built cannot keep up with the rate at which they are being demanded. Nor is the issue likely to go away any time soon. In fact, with the huge growth in the UK’s population, the situation is set to be exacerbated further still.”
Stephens is referring to the projection from the Office for National Statistics (ONS) that the UK population will surpass 70 million in the next 12 years. An increase of 4.4 million people by 2027, when the housing market is already creaking at the seams, London is likely to absorb a large proportion of the increase.
The average property price in the capital, of £499,999, is more than double the average of the rest of the country. Sophisticated investors are using this price point as a guide when it comes to purchasing properties with good prospects for capital growth.
Surrenden Invest’s Horizon London in Ilford is one such project that is precisely what investors in the capital are looking for, with the one and two bedroom apartments ranging in price from £225,727 to £498,925. According to Jonathan Stephens, Ilford is one of London’s most interesting hotspots right now,
“Ilford offers excellent value for property investors, with average prices there some 34.1% lower than the London average. With the advent of Crossrail we’re expecting a big increase in property prices in coming years and Ilford’s population growth is further enhancing the situation. The population is expected to grow by 22.5% by 2028 and house prices are forecast to increase by 40.7% by 2020, according to JLL. This makes for an extremely interesting time to be a part of Ilford’s property market and savvy investors are snapping property up apace.”
Ilford is one of the areas included in London Mayor Boris Johnson’s recently released ‘City in the East’ masterplan, which examines factors such as Crossrail and HS1 and their impact. From any angle, Ilford is set to experience an intense period of change, with many investors keen to be a part of the story sooner rather than later.
The other element to the UK’s residential real estate story, at least so far as buy-to-let investors are concerned, is of course yields. Across the UK, yields have risen by 2.7% over the past year, according to the ONS, and the improved potential for returns is encouraging ever greater numbers of individuals to turn to developments such as Horizon London to achieve a healthy income.
With London prices progressing on an upward trajectory, and setting new records all the while, Ilford is a key location for future growth and now is the time to get on board.
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