“Relatively affordable”: Investors benefit from London price growth
The two-bedroom apartments are located in Deptford, Lewisham, which is one stop on the train from London Bridge. With an asking price of £470,000, the development (RISE @ The Depford Profect) is the most expensive number one listing on TheMoveChannel.com since Investment Watch records began. Nonetheless, the property’s location in Zone 2 means that prices in the area are not as high as other parts of the city.
According to the Office for National Statistics, London property values surged 20.1 per cent in May 2014 year-on-year to an average of £492,196. The average price of a two-bed apartment in London listed on TheMoveChannel.com, meanwhile, is £698,701. The Deptford development is therefore relatively affordable, with returns strengthened by the potential for capital growth, even as price indices show signs of moderation in the London market.
Deptford, “the new Shoreditch”
Deptford has been labeled by Mayor Boris Johnson as one of London’s “main opportunity areas”, with 3,500 new homes and 200 new jobs earmarked as part of ambitious investment plans. Deptford is the “new Shoreditch”, says Ray Withers, Managing Director of Property Frontiers , who are handling the development.
“We have been really pleased with the response to our launch of Rise at the Deptford project; but we are not surprised,” Withers tells TheMoveChannel.com.
“We all know that London property has been extremely popular, but there is a really obvious trend with interest moving from prime London to the boroughs. Prime prices might be coming of the boil, but there are numerous areas in zone two which still look like good value and investors know that. Prices at less than £500 per square foot are seen low and likely to reach the £800 per square foot seen in Shoreditch in the medium term.”
Student most popular investment product of 2014
Student property is the most popular investment of 2014, TheMoveChannel.com’s Investment Watch also reveals. The CUBE, a student housing development in Bolton, received the most enquiries of any listing on the property portal in the first six months of the year. Student property in Bradford, West Yorkshire, accounted for the second highest. Indeed, four out of the top 10 listings of H1 2014 are student property investments, including one opportunity in Florida.
Buyers still cautious of high costs Confidence is returning to the global property investment market, but buyers are still cautious about keeping costs as low as possible. Three of the top 10 listings of 2014 so far have been alternative investments, as investors continue to consider products that offer the strongest returns for the smallest entry fees. Indeed, every listing in the top 10 of H1 2014 is priced below £83,000.
The trend continued in June 2014, with nine out of the month’s top 10
listings priced below £190,000. Deptford’s apartments were the sole exception, attracting enough demand to make it the most popular investment of the month – and the 12th most popular listing on TheMoveChannel.com of 2014 so far.
TheMoveChannel.com Director Dan Johnson comments: “Investors have consistently shown a preference in 2014 for products offering high returns on low fees, which has made student property and alternative assets ideal opportunities. Student housing is one of the biggest property sectors of the year. Demand has been so strong that even university accommodation in Florida has received the ninth highest number of enquiries on the site this year.
“Bricks and mortar, though, are hard to beat and London has stolen property headlines all year. A property fund in the capital was the third most popular listing in June, but the demand for Deptford was significantly higher. This is the first time that London has dominated activity on TheMoveChannel.com to such an extent.”