Is Now a Good Time to Invest in a London Property Development Project?
As the UK recovers from the COVID19 pandemic and the effect of restrictions such as lockdown on the property market, investors are once again rushing to London with various new property developments ongoing. Even though London is falling behind the rest of the UK in terms of house price growth, it still remains one of the most popular areas in the country for property investors of all types. Despite the issues caused by Brexit and the COVID19 pandemic, London and the UK remains one of the best options for property investment. London is still one of the biggest rental hotspots in the country, and people from all around the world are still interested in coming to live and work here. So, is now a good time to invest in property development projects in London?
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The City Returns to Normal With New Housing Projects in London
Despite COVID19 seeing many London properties go up for sale or tenants leaving to move somewhere larger and cheaper with the rise of working remotely during the COVID19 pandemic, the city’s employment is beginning to return to pre-pandemic levels. Offices are reopening with the relaxation of COVID19 restrictions. While many companies are allowing employees to continue to work from home, others are unable to continue with this model of working, and some employees just prefer working in the city. With working from home no longer mandated, people are getting back to everyday life in London, and keyworkers in the city are always going to need somewhere to live, which has led to a boom in the capital’s rental market. This has led to various new housing projects in London to consider investing in.
Crossrail London Development
The imminent completion of the Crossrail transport system development in London has made the capital even more attractive to property developers and investors. There are various areas of London that are set to benefit hugely from Crossrail, which has led to significant housing development investment in these areas as house prices are set to rise drastically due to the transport link improvement set to arrive. Now is certainly a good time to invest in properties close to Crossrail links as the project is not yet completed, allowing investors to buy low and then sell or rent out for higher prices in the future after Crossrail is in operation.
London Development House Prices are Low
After steadily growing for the best part of ten years, house prices in London are slowing down compared to the rest of the UK, particularly the Northwest. While the average house price growth in London is currently below the national average, this might not be great news for anybody looking to sell property in London but could be an excellent situation for anybody looking to invest in the city, allowing them to save on their initial investment into property developments. While house prices in London are predicted to move slowly in an upwards direction for the next couple of years, the market is gaining momentum meaning that now might be the best time to invest for high returns in the future.
New Construction Projects in London Add Value to Areas
Regeneration projects are in place in many areas of London, with the construction of new homes, amenities, and transport links adding value to some of the cheapest areas to live in the capital. With these projects underway, they provide an excellent opportunity for investors who are looking to buy low and sell high, or purchase buy to let properties in areas that are set to see growing rental yields as a result of the investments in the near future.
Off-Plan Investment in New London Residential Developments
With the demand for living and working in London getting back on track after the COVID19 pandemic, more and more new residential developments are underway, with the construction of new flats and houses in various areas of the capital. For investors, this means that it is a prime time to consider making off-plan investments or purchasing a property before the construction is complete. There are several advantages of doing this, including the fact that investors can often get a better deal since buying off-plan often costs significantly less compared to buying a property that is completed and ready to move into. And, the increase in new property developments in areas of London that are currently cheaper than others is set to increase the average house value in the area, meaning that your off-plan property may already be worth a lot more by the time it is built.
New Projects in London and Investment Hotspots for 2022
After the COVID19 pandemic, investors and property developers are determining the most lucrative moves to make in the property market right now. COVID19 is beginning to take a back seat as normal life begins to return slowly, and the capital of the UK is one area that has bounced back quite well. With the demand for properties rising, the market is set to gain momentum once again, despite the fact that interest rates are rising.
With that in mind, these are set to be some of the best places to invest in London property in 2022, with new housing developments and area regeneration underway or recently completed in many of these neighbourhoods.
Tottenham – Major regeneration projects are in the works the Tottenham area of London, backing significant growth and offering a lot of room for equity growth.
Edmonton – With huge regeneration benefits and excellent transport links into the city, Edmonton is one of the best places for buy to let investors in London this year. It has a vibrant, multicultural community and there are high rental yields.
Seven Sisters – This up and coming area is in close proximity to many popular areas and has excellent transport links. As one of the more affordable places to live in London, demand for housing here is high.
Barking – Barking is an area of London that offers great affordability. Excellent connectivity to the city and investment in regeneration of the area also provides some high opportunities for growth.
Chadwell Heath – With the Elizabeth Line set to be completed soon, close proximity to various leisure and retail hubs, and good rental yields, Chadwell Health is a great choice for property investors looking to invest in new developments in a more suburban neighbourhood of London.
Ilford – Another area set to be positively impacted by the imminent completion of the Elizabeth Line, Ilford is likely to be a great option for investors with steady rental yields, more affordable property prices compared to some other areas of London, and high demand among commuters due to great transport links.
London Redevelopment Projects Set to Transform Neighbourhoods
By 2025, London is set to look quite different with various redevelopment and construction projects underway.
Nine Elms – The Nine Elms neighbourhood is one such area that is set to have a complete overhaul. This 500-acre waterfront area has been redeveloped since the early 2000s, when thousands of new housing units, shops, and restaurants were added. By 2025, the area is expected to have even more including offices, hotels, thousands more housing units, and two Underground stations. Nearby Embassy Gardens is a 15-acre development that is set to add almost two thousand more homes, restaurants, shops, office spaces, a health centre, playgrounds, and a hotel.
Wembley Park – Set to be complete in 2024, the Wembley Park project has received around £1bn in funding so far. It is a large-scale housing development surrounding the popular Wembley sports stadium, which is located around 12 miles northeast of London’s centre. It will have five thousand residential homes that will be available to either purchase or rent along with a school, hospital, public park, plaza, shops, restaurants, and office buildings.
How is the London Property Market Predicted to Perform in 2022?
While the London property market is currently falling behind the UK average in terms of growth, this hasn’t stopped many investors in the capital. Although property prices here still remain some of the highest across the UK, the pace of growth has slowed down. While experts predict that the London property market is set to continue with slower rates of growth compared to the rest of the country over the next year, this is not unlike other areas, which are also predicted to see a fall in house prices as the impact of the stamp duty holiday wears off. Central London is expected to see a strong growth in house prices of around 8% throughout the year, while outer London will see rises of around 4%. While this increase might seem small in comparison with some areas of the UK, particularly the north-west, some properties will still see a significant increase in value due to already being worth millions of pounds.
With more being invested in London property development due to high demand for housing in the city, low house price growth is not putting many investors off from investing their funds in this multicultural investment haven.
