The development of Crossrail is something we have previously written about in detail, as the market continued to speculate on the potential effects on London property investment. However, the consequential development of Crossrail’s surrounding areas has proved nothing but prosperous thus far. The regeneration above and below ground is causing a number of postcodes to pick up speed alongside the already rising London house prices.
Crossrail has effectively boosted house prices at least a year before its opening, with some locations now expecting a house price growth of at least 16% above the current Greater London average by 2020. We’re also to expect a 7% lift in average residential prices around Crossrail stations compared to those further afield.
These figures show no sign of easing up. With places like Slough – the last stop on the new Crossrail line – seeing the biggest house price increase in the country (a 19% rise in just a year and a 2.1% jump between January and February alone). Growing property values have clearly proved beneficial for encouraging investment in less-central London locations.
Regardless of the widespread house price boom, the ‘Crossrail Factor’ has certainly created a buzz in the market. It has already significantly impacted the average house price metrics, and is anticipated to fuel a further 7% rise in Crossrail route locations over the next 4 years.
The Crossrail is the largest construction project in Europe and its development is injecting money in all areas surrounding the line, as well as providing a lift for the capital as a whole. This is an unsurprising result, but something that smart investors should be keeping a close eye on -especially as the line continues to drive value growth and opportunity across its length. We are expecting investment zones to emerge which will offer longer-term capital growth to investors with yields that are often harder to achieve in the more central zones.
To evidence some of the house price movements along the route, prices in Ealing are expected to rise by almost 50% in 2020 and 39% in Woolwich over the next 5 years. Hillingdon – of which The Elizabeth Line will run through – has already seen property prices jump by 17.1%, while the likes of Thurrock and Dagenham have seen a 16-17% increase. West Drayton, Whitechapel, Slough and Abbey Wood are also predicted a 33% rise in house prices over the next 5 years.
Equally, Farringdon is predicted to become one of London’s busiest stations and best-connected economic hubs – providing Thameslink, Crossrail and Underground access. As such, house prices in Farringdon have already risen by £305,000 above the postcode’s average.
In line with this, up to 100 businesses, including designers Alexander McQueen and Kurt Geiger, are voting on a proposal for Farringdon and Clerkenwell to become a Business Improvement District (BID), which would introduce a mandatory levy for businesses, investing money into the area and reinforcing its reputation for innovating and creativity, rather than simply a crossroad junction. Because of this, house prices are naturally expected to skyrocket.
As Crossrail’s completion date edges closer, now is the time to invest in the surrounding areas and reap the benefits of stronger demand and rising prices, before the influx really hits. This is especially applicable for landlords looking to expand their buy to let portfolio, as demand for rental properties in and around London is only going to move in leaps and bounds from here.
If you have any questions about this article or investing in London property in general, please do not hesitate to contact us, where one of our expert brokers will be happy to talk through your options with you.