Rapid house price increases, government interventional policies such as stamp duty charges, Brexit and a reluctance to buy in the capital has meant that there is now limited scope for growth in London’s property market. Sellers are recognising the sluggish environment and are more apprehensive about putting their property on the market. According to Rightmove, asking prices in the capital overall were down 1% in February 2018 compared to the previous year, and are likely to fall a further 2% in 2018. The capital’s housing market has been lagging against the rest of the UK with sellers launching their properties on Rightmove at 1.4% cheaper than the previous month.
Whilst buyer apprehension has had a negative impact on the London property market, there is still positive sentiment in investing elsewhere in the United Kingdom. For those who recognise the benefit of buying property for the occupation of city professionals but who do not wish to pour money into the capital’s faltering market, there are opportunities in satellite towns and areas that surround the capital.
As transport infrastructure improves in and around London, it is even easier and quicker for those living in commuter towns to travel to and from the capital. Projects such as Crossrail will ensure that parts of Berkshire and Essex are better connected, and Great Northern is launching new train routes in May of this year. These will connect cities such as Peterborough and Cambridge, and towns in Hertfordshire with more major interchanges in London such as Farringdon and London Bridge, and then on to Gatwick airport before reaching the end of the line in Brighton.
One such place the new Great Northern train route will service is Stevenage. Not only will this new route open previously hard to reach places in London, but there are also plans to introduce more fast-train services to the station, ensuring that commuters can reach the capital quickly. The improving transport network has raised the town’s profile with investors and those looking for somewhere to live alike. One-bedroom flats in King’s Cross in London start from £675,000, whereas flats in Stevenage sell for an average of £195,750 and King’s Cross can be reached in around twenty minutes, so it is a sensible alternative for cash-strapped professionals who are priced out of the capital. The town’s growing desirability is reflected in the price of property, which experienced the third highest growth in property prices out of 60 towns and cities in England and Wales over the last decade.
For good levels of capital growth, the property must be strategically located in an area where prices are still affordable, and there is a good concentration of people who wish to buy. The average salary in the UK is £34,878, so a couple will be on £69,756. With the average property price in Stevenage being £292,093, couples can easily afford a property in Stevenage if they have a reasonable deposit. This is clearly more affordable than Greater London, where the average house price is £619,181, almost 10x a combined average salary.
House prices in the town rose by 58.5% according to HouseSimple between 2007 and 2017, placing it just behind London and Cambridge. Average property prices in Stevenage remain modest compared to those in the capital (£292,093 overall average v £619,181 overall average in London). With the improvements being made to the transport network along with a £350m injection to regenerate the town centre, there is more scope for capital growth for those who purchase property there.
Park Place is a new residential property in Stevenage that will comprise 202 one, two and three-bedroom Manhattan-style apartments. Interiors will be modern and stylish, to reflect the town’s developing centre, and the kitchens and bathrooms will have chrome finishes, to add a touch of high end style. A dedicated concierge and fibre-optic broadband will be just a few of the premium services residents of Park Place will be able to enjoy, which will further boost its appeal to the discerning professional.
Park Place is a short walk from Stevenage’s train station, which makes it convenient for professionals who commute to London. It is also close to Westgate shopping centre and the Garden Cities of Welwyn and Letchworth for weekend exploring. Apartments in the complex start from £194,522 and an appealing aspect of the investment is the capital gains that can be achieved, as property prices in Stevenage are predicted to rise by 24% by 2020 as it becomes increasingly relied upon to cater for London’s overspill.
Contact One Touch Property today to learn more about how London’s stagnating property market creates opportunities in its commuter towns, and how to identify them to get good levels of capital growth.
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