It was interesting to look at figures from A-Plan Insurance this week on the best property hot spots for price growth over the past ten years. The data showed that nine of the ten top areas for house price rises in the UK were located in London.
East and South East London led the field, with Waltham Forest seeing price growth of 126% since 2011. It was followed by Hackney, with price rises of 105%, then Barking and Dagenham, at 96%. Newham, Bexley and Greenwich also made the top ten.
While it’s interesting to see the rises of the past, those currently investing in the market are understandably more interested in identifying the property hotspots of the future. According to Fabrik Invest, this is why it’s time to look North.
“Looking ahead ten years, it’s easy to imagine that nine out of the next ten property hotspots will be in the North. We’ve seen a huge shift of investor interest from South to North in recent years. That’s because northern cities are delivering greater potential for capital growth, better yields and strong, sustained tenant demand.”
Dale Anderson, Managing Director,Fabrik Invest
Savills certainly puts the North at the top of the table when it comes to projected price rises for the next five years. From 2021 to 2025, the company forecasts that the North West will see house prices go up by the UK-leading rate of 28.8%, followed by Yorkshire and the Humber at 28.2%. That’s compared to a forecast UK average rise of 21.1%. Meanwhile London, the South East, the South West and the East of England are projected to see prices rise over the same period by between a notably below average range of 12.6% to 18.7%.
So, what is driving this northern boom? As ever, a range of factors are at play. Extensive redevelopment work across cities such as Manchester, Liverpool and Preston is doing much to push prices up, with new spaces to live, work and play attracting owner occupiers and investors alike.
There’s also the impact of HS2 to account for. Transport Secretary Grant Shapps has advised that the original opening date of 2026 is now more likely to be somewhere between 2028 and 2031 (and that was before the pandemic was even factored in). Nevertheless, the line’s significant reduction of the journey time between the South and the North will likely contribute considerably to rising prices in the latter towards the end of the coming decade.
“The Northern Powerhouse initiative opened a lot of investors’ eyes to the potential of the North. At the same time, so many ‘best place to live’ type accolades are going to northern cities. Add in the fact that increased working from home has cut many families’ ties with specific locations, meaning they can head north in search of better value, and there’s a clear case for this region leading the UK over the coming decade.”
Dale Anderson, Managing Director,Fabrik Invest
For investors looking to capitalise on northern growth, developments such as The Exchange are ideal. Located in Preston, which is itself in the midst of a huge redevelopment boom, the development offers city centre living with on-site amenities that include a gym, residents’ lounge, elegant rooftop garden, concierge and bike storage. Commercial units on the ground floor will be used to help build a local community vibe, as well as deliver practical goods and services.
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