London hotspots tipped for house price growth: Croydon and Haringey among best areas to buy in for future growth
House prices in Hackney have climbed by 807 per cent since 1995, the highest growth rate of any London borough.
It is the ultimate story of modern urban change: gentrification coinciding with regeneration thanks to the Olympics and the wealth produced by Silicon Roundabout.
Lambeth recorded the second highest rise over the past 25 years, at 666 per cent, followed by Tower Hamlets on 664 per cent, Southwark on 655 per cent and Westminster, 640 per cent, according to data published by Savills today.
The slowest growth recorded over the period was in Sutton at 422 per cent, Bexley, 425 per cent and Harrow on 429 per cent.
Even these slowest rises highlight why London continues to endure an affordability crisis, where deposit saving can’t keep pace with property price growth.
Despite the recent cool-down, compounded by political unease, house prices between 2015 and 2020 fell in only two boroughs — Kensington & Chelsea at minus one per cent and Hammersmith & Fulham with minus four per cent.
“We have seen the London property market pull away from the rest of the UK and wild variation across the capital,” says Lucian Cook, head of residential research at Savills.
“Global wealth poured into the luxury neighbourhoods and buyers piled into more affordable areas with high-quality housing stock.”
Hotspots of the last 25 years
This Zone 2 borough embodies all the elements of change that drive long-term house price growth.
After the dotcom crash and the banking crisis, a boom in central London property values triggered the flight to Hackney.
Canal views: prices at Fish Island Village in Hackney start at £108,750 for a 25 per cent share of a one-bedroom flat
New buyers who wanted easy access to the City migrated to Hoxton, Shoreditch and Dalston, where they could find better value for money than in Westminster and Kensington & Chelsea.
With the Olympics regeneration and the Government push to attract tech businesses to Silicon Roundabout, came a wave of development.
Hackney council undertook town centre upgrades and the Design Council declared it the most liveable borough.
“Gentrification is a market-led process. Once an area gets too hot, buyers look for nearby areas that are undervalued,” explains Charlie Hart of Knight Frank. “Regeneration is direct investment framing large-scale redevelopment around new infrastructure. Hackney has seen both go hand in hand, supported by the Overground.”
Hackney’s journey is far from over. The new canalside Fish Island Village is on the edge of the Queen Elizabeth Olympic Park. When complete there will be almost 600 homes plus co-working space, artists studios and a gym.
Prices start from £647,500 for a two-bedroom flat but shared-ownership homes are available, too, with a one-bedroom property priced at £108,750 for a 25 per cent share. Visit fishislandvillage.co.uk for more details.
There are 69 studios, one- and two-bedroom apartments on sale via Knight Frank in the HKR Hoxton building in Hackney Road, with prices from £535,000 (020 7718 5202).
The inner boroughs of Lambeth, Tower Hamlets and Southwark — which came second, third and fourth in the Savills ranking — were left downtrodden by deindustrialisation but have regeneration projects in their midst.
There are 140 major development opportunity sites in Lambeth, and these stretch from Southbank down to Streatham.
Meanwhile, love-it-or-loathe-it Nine Elms, the stretch of new-build high-rise towers, is bringing new residents and workers.
There are one-bedroom apartments available in the new block REZ in Stockwell SW9, starting from £100,000 for a 25 per cent share of £400,000 flat. Call Network Homes on 020 7274 2878.
The sister block, BRX in Brixton has homes for sale starting from £470,000. Call 020 7483 6362 for more information.
Heavily bombed in the wartime Blitz, Tower Hamlets has seen house price growth driven upwards by the evolution of Canary Wharf.
The east London borough has the biggest pipeline of new homes for first-time buyers in the capital.
From £140,000: 25 per cent of a two-bedroom shared-ownership flat in the Echo complex at London City Island
Two-bedroom shared-ownership apartments are available at Makers Dock alongside Limehouse Cut priced from £116,250 for a 25 per cent share. Visit peabodysales.co.uk for full details.
There are only a few two-bedroom apartments left in the Echo complex at London City Island. Prices for a 25 per cent share start from £140,000.
There are 24 projects as part of the £4 billion regeneration of Elephant & Castle.
Plans for a new town centre were approved last year which will include a new campus for the London College of Communication, and Peabody housing association, one of the capital’s oldest and largest, has submitted proposals for a mixed-use scheme at Borough Triangle, temporarily the home of the popular food market Mercato Metropolitano.
Prices start from £785,000 for a one-bedroom apartment at the 3,000-home Elephant Park development. Call 020 3675 9955.
Southwark homeowners will also benefit from the spread of investment down Old Kent Road.
Which are the best districts to buy in now?
The Savills data reveals some clues on where today’s home buyers should be concentrating their search.
For the five years between 2005 and 2010 Croydon was 30th out of the 32 boroughs for house price growth.
However, following the London riots of 2011, the council-led building programme started to pay off and Croydon is creeping up the rankings.
“There was no boom and bust in Croydon because values never got high enough to attract that type of investment,” says Colm Lacey, chief executive of the borough council-owned developer Brick by Brick.
In the Seventies and Eighties Croydon town centre was geared around offices and roads, expecting more workplaces to set up in the suburbs.
With the reinvigoration of the City, businesses didn’t arrive and Croydon was left in decline.
“We are now trying to retrofit a mixed economy and housing based on a series of overlapping masterplans,” Lacey adds.
Brick by Brick is announcing the completion of five affordable schemes this week, comprising 129 homes. It has 43 schemes under way which will deliver 1,000 homes and profits go back to the council to be spent locally.
There are 24 one- and two-bedroom apartments at Flora Court in Thornton Heath with prices starting from £73,750 for a 25 per cent share of £295,000 home. Call 020 3034 2565
Buying in Croydon
A sensible buy in Croydon: Niamh Wallace bought a two-bed apartment in Auckland Rise
Nurse Niamh Wallace, who has a four-year-old son, was looking for somewhere to rent when she realised it would be cheaper for her to take advantage of the government Help to Buy scheme and get a place of her own.
She has purchased a two-bedroom apartment for £465,000 in Auckland Rise, a scheme by Croydon council’s development company, Brick by Brick.
“The thoughtful architecture caught my eye,” she says
Argent Related, the developer behind the new King’s Cross, has turned its attention to Tottenham Hale in Haringey where a huge gyratory in front of the train station has siloed neighbourhoods.
“Tottenham Hale is very challenging. For 50 years it has been centred around road infrastructure diving its communities,” says Tom Goodall of Argent. “We have streamlined the bus station and reduced journey times, created four new crossings to improve safety and we’re carving out a new, well-lit public realm the size of two football pitches.”
The new Ferry Square will form the heart of the civic space with residential going up around it.
1 Ashley Road is the first new residential building with one-, two- and three-bedroom homes now on sale and a roof garden where children can play. Prices start from £413,000. Call 020 7205 4047.
Meanwhile, Lendlease is drawing up a masterplan for High Road West, the area around Tottenham Hotspur FC’s White Hart Lane stadium.
And St William is building a new village between Hornsey and Wood Green. Called Clarendon, it will comprise 1,700 homes, 22 pocket parks and 100,000sq ft of offices, restaurants, bars and start-up space.
Prices range from £350,000 to £716,000. Call 020 3002 9464.