London Property Investment: Should I Invest in London Property in 2022? 

London Property Investment
Daniel Williams
Daniel Williams
Senior Property Writer
15 Min Read

Why Invest in London Why Invest in London

Is property investment in London still a top choice in 2021? 

Let’s find out in this ultimate London property investment guide. 

Here, you will learn about all the latest property investment London market data to help determine whether you should still invest in London in 2021. 

Other topics in this guide to London property investment include: 

  • Is London Property a Good Investment? 
  • Best places to invest in London 
  • Latest investment opportunities London 
  • Where to invest in London 2021 
  • Is it worth investing in London property? 

And more! 

We’ve split the guide into five chapters, so you can read exactly what you want. 

So, keep reading to learn all about real estate investment in London… 

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    Contents

    Why Invest in London?
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    Chapter 1: Why Invest in London?


    London Property Market Analysis
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    Chapter 2: London Property Market Analysis


    Best Places to Invest in London
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    Chapter 3: Best Places to Invest in London


    Alternatives to Property Investment in London
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    Chapter 4: Alternatives to Property Investment in London


    Investment Property for Sale in London Region
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    Chapter 5: Investment Property for Sale in London Region


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    Why Invest in London in 2021 Why Invest in London

    Chapter 1: Why Invest in London?

    Chapter one of our property investment London guide will discuss the reasons why you might (or might not) choose to invest in London in 2021.

    Here, we will look at three reasons why London property investment is a compelling choice and why it is no longer the best investment you can make.

    Key Topics:

    • Latest Property Investment Market Data
    • Three Reasons Why You Should Invest in London
    • Three Reasons Why You Shouldn’t Invest in London
    Why Invest in London in 2021 Why Invest in London in 2021

     

    Why Invest in London in 2021? 

    London property investment can be a confusing topic to discuss. 

    With sky-high prices and lower than average rental yields, property investment in London isn’t accessible for everyone. 

    Yet, the city still sees its fair share of investment, particularly from foreign sources. 

    In fact, a report from Statista in 2018 found that London featured 458 foreign investment projects – 12 times higher than Manchester in second place. 

    But why is this the case? 

    Let’s find out and explore three reasons investing in London is a wise choice. 

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    London Rent Is Incredibly High London Rent Is Incredibly High

    1. London Rent Is Incredibly High 

    The main reason behind the continued real estate investment in London is the sky-high rental income generated from property. 

    According to Zoopla, in October 2021, the average rent in the London region was around £3,431 per month. 

    For comparison, this is 223% higher than the UK national average, which is incidentally the highest it has ever been at £1,061 PCM, according to HomeLet. 

    Average Monthly Rent UK Average Monthly Rent UK

     

    In fact, London average rent is so high that it practically trebles the rent in every popular UK property investment hotspot, as you can see from the table. 

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    Top Destinations For Commercial Real Estate Top Destinations For Commercial Real Estate

    2. Top Destination for Commercial Real Estate 

    While investments in London may not be the standout choice for residential property, commercial real estate investment is another story. 

    Taking advantage of London’s serious pull for businesses, investors from across the globe choose London as their ideal commercial property hunting ground. 

    In fact, back in 2019, a report from real estate firm Knight Frank found that London was the world’s number one spot for commercial real estate, seeing around £16.2bn worth of investment. 

    For comparison, this was higher than the iconic Manhattan (£14.3bn), Paris (£12.1bn), and Hong Kong (£8.4bn). 

    Most interestingly, these statistics have continued to persist despite the impact of Covid-19 and Brexit, with Savills reporting that commercial real estate investment is “exceeding expectations” in 2021.  

    This considerable level of international investment sets a commercial property investment in London apart from other European cities. 

    Around £3.69 billion was spent on commercial real estate in London in 2017 alone from Chinese investors. 

    Sadly, for prospective residential investors in London, the same cannot be said for residential real estate – something we will address in a later section. 

    Massive Regeneration in London Massive Regeneration in London

    3. Massive Regeneration in London 

    As the UK capital, London attracts the bulk of UK inward investment, which has led to some considerable regeneration in the city. 

    Ever since the 2012 Olympics hosted in London, there has been a series of transformative projects helping the capital continue to flex its economic muscles on the world stage. 

    Likely the most extensive upcoming regeneration efforts in the city are: 

    • Thamesmead – A 30-year master plan aimed at regenerating the Thamesmead neighbourhood. Work includes 8,000 new homes, 4,000 jobs, and improvements to 5km of riverbank and 7km of canals. 
    • Old Oak Common and Park Royal – A £26 billion project set to create a transport superhub, a brand-new high-street and a £3bn Imperial College. 
    • Crossrail – a £14.8bn enhancement of train links in London. It involves the introduction of 118km of new rail track and is expected to boost the UK economy by £20bn. 

    Crossrail, in particular, is likely the most significant project as it will improve tenant demand in areas across the South of England.  

    This includes commuter towns like Slough, which has seen house prices increase by over 60% in areas near new Crossrail links.  

    To learn more about UK regeneration, be sure to click the link and read our full 2021 guide.  

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    WHy Shouldn't You Invest in London in 2021 WHy Shouldn't You Invest in London in 2021

    Why Shouldn’t You Invest in London in 2021? 

    Now that we’ve covered three reasons why you should invest in London, it’s time to look at reasons why property investment in London is best avoided for most investors in London. 

    These reasons include: 

    1. High property prices 
    2. Low rental returns 
    3. Dwindling rental demand 

    Let’s get into it! 

    1. High Property Prices for Investment Properties in London 

    The primary reason why property investment in London is a poor choice for most UK investors is its affordability. 

    Simply put, you will likely struggle to afford investment properties in London due to the enormous prices seen in the area. 

    According to the latest UK House Price Index figures, property prices in London are around £756,917. 

    From the same source, the wider London region now features an average price of about £525,893. 

    These are considerably high numbers, especially compared to the UK average, which currently stands at £264,244. 

    Average House Prices UK Average House Prices UK

     

    That means city of London prices are 186.45% higher than a typical UK property. 

    These numbers can be on the low end of the spectrum, with affluent London locations like Kensington and Chelsea having considerably higher property prices. 

    Currently, a typical Chelsea property on Zoopla can set you back an eye-watering £2,399,389. 

    Likewise, a Kensington property on Zoopla costs, on average, a staggering £2,304,870. 

    These property prices are undoubtedly astronomical, which has put many people off property investment in London. 

    Factoring in Stamp Duty rates, too, and you could be spending a lot of money on your London rental property or commercial property purchases. 

    To work out the latest Stamp Duty rates, be sure to use our free Stamp Duty calculator. 

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    Low Rental Returns For Property Investment London Low Rental Returns For Property Investment London

    2. Low Rental Returns for Property Investment London 

    Despite the high rent found in London real estate investment, the high cost of property has led to some dismal rental yields in the capital’s residential property market. 

    Understanding rental yields is one of the most important tips for investing in property. 

    Rental yields are the return on your investment you earn through rent. It’s calculated by dividing the yearly rental income by the original purchase price and multiplying it by 100 for a percentage. 

    These yields are a crucial element of any property investment venture, with higher yields meaning stronger rental returns. 

    Average Rental Yield Across the UK Average Rental Yield Across the UK

     

    Using the latest Zoopla data, gross rental yields in the city are around 5.44%. 

    While this figure may not seem incredibly low, it’s important to note that this is just the gross yield, meaning expenses aren’t calculated. 

    Due to the high cost of living seen in the capital, the NET yields will likely be far lower than this. 

    For comparison, it’s common to find properties in Liverpool and Manchester with over 8% NET rental yields. 

    These rental yields illustrate why focusing on just rental income per month is not the best measurement, as you can likely get better returns elsewhere due to the lower property prices. 

    For example, let’s say you invest in Manchester, a city with house prices of around £203,835. 

    For the price of one London property, you could buy three in Manchester with money left over. That means you could expect a yearly rental income of almost £50k – £10k more than London. 

    With Northern cities like Liverpool and Manchester offering everything an investor needs for a solid investment, there’s no reason why investors into the UK property market shouldn’t also explore the wide range of opportunities available in these cities. 

    This is important to keep in mind if you’re considering buying property in London.

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    Rental Demand Dwindling With Renters Leaving the Capital Rental Demand Dwindling With Renters Leaving the Capital

    3. Rental Demand Dwindling With Renters Leaving the Capital 

    While there is significant demand for property in London, these numbers have dwindled in recent years. 

    Although London property has always been the go-to city for ambitious young people, recent figures have started to show that more people are moving to Northern cities like Manchester. 

    Around 13% of Londoners leaving the capital choose to live up North to take advantage of affordable prices and exciting business potential, limiting tenant demand offered by investment in London. 

    New developments such as MediaCityUK in Salford, home to major business headquarters like the BBC and ITV, are attracting people from around the country. 

    This surge of people leaving the capital to move up North is likely to have a big effect on the London property market and change the buy to let opportunities available for those who wish to invest in London property. 

    Since many people leaving London are young professionals, the demand for quality property with higher-than-average rental yields will diminish, replaced by demand from tenants with lower incomes. 

    In fact, this mass exodus of people leaving the capital, accelerated by Covid-19, has led to severe downturns in the local rental market. 

    Leading estate agency Chestertons has found that London rental stock has dropped by 58% year-on-year in September 2021, with many landlords choosing to sell up. 

    Likewise, Bloomberg reports that London property rental values fell at the sharpest pace in over a decade in August 2021. 

    This is not a good sign for the future of property investment in London and is vital to consider if you’re sizing up investing in London property. 

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    Property Investment London 2021-22 Analysis Property Investment London 2021-22 Analysis

    Chapter 2: Property Investment London 2021/22 Analysis

    Chapter two of the London property guide will analyse the London property market in 2021 and 2022. 

    In this section, you will learn about the latest house price growth data, as well as the newest growth predictions for London investment property. 

    Key topics: 

    • London property prices 2020/21 
    • London property price predictions for 2022 onwards 
    • Analysis of the London property market.  
    • What’s it like living in London in 2021? 
    Property Investment London 2021-22 Property Investment London 2021-22

    Property Investment London 2021/22 

    Summary: 

    • The current average property price in London is £756,917. 
    • London property prices fell by -13.13% in the last 12 months. 
    • London rent fell at a 10-year high. 
    • London property takes 1.5x times longer to sell. 

    After a record-breaking year in the property market, caused by a newfound urge to move homes post-lockdown, the London property market has been left behind.

    As a consequence of the covid-19 pandemic, London’s economy has been decimated, with employment levels falling, new jobs dropping, and property prices plummeting.

    A report in October 2020 found a staggering 200,000 fewer employees in the capital than in the year prior.

    This has resulted in 5% of London residents claiming unemployment benefits.

    The city isn’t recovering well, either, with research from the Centre for Cities and Indeed finding that London job postings are 26% below pre-pandemic levels.

    All in all, this has led to the London economy losing a reported £56 billion.

    Naturally, this massive loss in money has had a distinct impact on property investment in London.

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    London Property Prices Since March 2020 London Property Prices Since March 2020

     

    Currently, the average London property is valued at £756,917, according to the latest available Land Registry data in November 2021. 

    While this is 2.96% higher than a month prior, it shows a massive -13.13% drop over June 2021.  

    Currently, house prices in London have dropped in value by £161,340 since the peak of April 2020. 

    For comparison, despite Covid-19, the average UK property is 10.56% higher than 12 months ago. 

    These plummeting house prices have put off many investors looking at buying property in London. 

    Average Time to Secure a Buyer in London Average Time to Secure a Buyer in London

     

    In fact, according to the October 2021 report from Rightmove, it currently takes 57 days for a seller to secure a buyer in London.

    In comparison, it takes 37 days for the average UK property. 

    At the same time, rental prices are also dropping, with the ONS recording a 0.4% drop in London letting prices in August 2021, the sharpest decline since 2010.

    This is while the rest of the UK, excluding London, saw rent increase by 2%. 

    With all these statistics in mind, it’s a precarious time to consider buying property in London.

    There is no guarantee when, and if, house prices will return to pre-pandemic levels for investors in London.

    If you want to buy a property in London, now may not be the best time given the current economic struggles the region is seeing.

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    Property Prices by London Region 

    To help you learn more about house prices in London, take a look at the following table to find the average property prices available for each region, according to Zoopla. 

    Average Property Price For Each Region Average Property Price For Each Region

     

    Currently, East London is the cheapest location for real estate investment in London, with the average property valued at £589,351. 

    Here you can get flats and semi-detached houses for just £429,835 and £630,574 respectively, which is incredibly cheap for London. 

    The most expensive area is Central London. For an average house, you can expect to pay a whopping £2,677,565. 

    Due to London property prices, if you are an everyday investor in need of a mortgage loan, many real estate investment London opportunities are unachievable. 

    These figures highlight how important it is to do your research when finding the best investment opportunities London has to offer. 

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    London House Price Predictions For 2022 and Beyond London House Price Predictions For 2022 and Beyond

    London House Price Predictions for 2022 and Beyond 

    If you decide that investing in London property is the right choice for you, you’ll likely want to know about the capital growth potential of real estate investments in London. 

    Historically, London property has seen huge rises, with the average London property price rising by almost £300k since 2001. 

    Naturally, while these London house prices have seen considerable increases in the past, it has now reached the point where percentage increases are now very minimal. 

    This is highlighted in the latest property price predictions from Savills. 

    London 5 Year Prediction London 5 Year Prediction

     

    Property prices are set to increase by just 2.0% in 2022, 2.5% less than the North West and Yorkshire. 

    There’s also minimal growth expected in 2023, 2024, and 2025, with an overall five-year increase of 12.4%.  

    Based on the latest Land Registry data for the London region, this would mean that the average London property would be valued at around £590,000 by 2025 if the Savills predictions are accurate. 

    For context, this is the lowest prediction provided by Savills, with London significantly lower than the likes of the North West (28.0%), Yorkshire and The Humber (28.0%), and the West Midlands (23.9%). 

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    How Has Covid-19 Affected London Property Investment How Has Covid-19 Affected London Property Investment

    How Has Covid-19 Affected London Property Investment? 

    While 2021 has remained a promising year as a whole despite the uncertainty brought by the Covid-19 pandemic, the London property market has experienced some changes that have impacted property investment opportunities in London. 

    Most notably, the rental market in London has experienced a shift in line with changing rental market trends. 

    As a result of the Covid-19 lockdown, renting habits have changed, which has had dire consequences on the viability of London buy to let. 

    A 2020 report from estate agents Benham and Reeves found that the top three tenant priorities are fast broadband, outside space, and proximity to green space. 

    Tenant Priorities When Selecting a Property Tenant Priorities When Selecting a Property

     

    Due to the nature of central London buy to let, more and more people are choosing to leave the hustle and bustle of the capital for a more peaceful living experience elsewhere. 

    This is why modern developments like Central Park in Liverpool offer outdoor green spaces to meet this growing demand. 

    What Tenant Should You Target For Property Investment London What Tenant Should You Target For Property Investment London

    What Tenant Should You Target for Property Investment London? 

    With this new era of tenant priorities, what type of tenant should you target to make the best property investment in London?

    Well, around 40% of Londoners are aged between 20 and 44.

    This is significant for investors as those ages are typically referred to as Generation Rent.

    Generation Rent is usually used to describe this age group as they are typically unable to afford hiking property prices and instead opt to rent.

    With so many Generation Rent members in the city, it would be wise to target younger people.

    This means providing more affordable properties to rent, modern facilities, and good access to transport links.

    Given the percentage of those living in London aged under 19, another viable choice is to invest in student London investment property.

    If you’re looking at London to invest in rental property, student accommodation can be an excellent investment.

    One of the biggest draws of international investment in the city, London has one of the largest student populations in Europe, with 180,000 students in the University of London alone.

    More and more property developers are providing student rental property and student accommodation in the city, so it may be a good idea to flesh out your London property portfolio with a student flat in London.

    To learn more about student property investment, be sure to check out our all-new 2021 guide.

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    What's It Like Living in London What's It Like Living in London

    What’s it Like Living in London? 

    London is iconic. 

    With a population of nearly nine million, the city is renowned for being one of the best places to live and work. 

    Home to around 15% of the UK population, and 23% of UK-based businesses, the city is overflowing with opportunities for both work and play. 

    While the cost of living is higher than anywhere else in the UK, the city has so much to offer residents who can afford the commanding premium of capital city living. 

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    Best Places to Invest in London 2021-22 Best Places to Invest in London 2021-22

    Chapter 3: Best Places to Invest in London 2021/22 

    Chapter three of our guide will help identify the top places to invest in London in 2021 and 2022. 

    Here, you will find a breakdown of the best areas to invest in London by postcode, region, and area name. 

    Using the latest data, you will be able to find out where to invest in London property 2021. 

    Key topics: 

    • Where to invest in London property 2021 
    • Best areas to invest in London by postcode 
    • Best places to invest in property in London by region 
    • Best places to buy London property by area 
    The Best Places to Invest in Property London by Postcode The Best Places to Invest in Property London by Postcode

    The Best Places to Invest in Property London by Postcode 

    If you’re looking at where to invest in property in London and want the highest yields, the following five postcodes are perfect for you if you are interested in property investment in London. 

    The best property investment London postcodes are E20, E4, NW7, SE28, N9. 

    Best London Property Postcodes Best London Property Postcodes

     

    • NW7 – Covers the Mill Hill region and can generate huge 8.05% returns despite an astronomical average price on Zoopla of over £770k. 
    • E20 – Spans Olympic Park and Stratford and provides gross rental yields of 5.57% on average. 
    • SE28 – Consists of Thamesmead and delivers sizeable rental returns of 4.76%, with the highest capital growth on this list. 
    • E4 – Covers Chingford and Highams Park, offering rental yields of 4.39%. 
    • N9 – Spans the Lower Edmonton area and provides fairly low average house prices of over £340k with 4.32% rental yield returns. 

    Other areas that could be considered the best area to invest in London property are Ilford, Romford, Barking, Dagenham, and Harlington. 

    This is because these areas also offer decent yields, with high demand levels and high rental income. 

    Although still more expensive than elsewhere in the UK, property prices in these locations tend to be more affordable than in other London boroughs. 

    This is why market research is vital if you want to know how to invest in London successfully. 

    Without knowing the best places to invest in property in London, it can be challenging to make a healthy profit. 

    For the most successful London investment, be sure to consider the best property investment London postcodes mentioned. 

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    Best Places to Invest in Property London by Region

    Now, it’s time to look at the top places to invest in London by region. 

    Here, you will find the latest market data for house prices in Central London, North London, South London, West London, and East London.  

    To help give you a better idea of where to invest in London property and where to find the best real estate investment in London, here is a guide to some of the best places to invest in London, with details on rental yields, capital growth, and average property prices. 

    All statistics have been calculated and taken from Zoopla’s house price database.

    Avg. House Price: £2,677,565 

    Avg. Gross Rental Yield: 3.51% 

    Capital Growth Since 2011:  61.62% 

    Undoubtedly one of the best areas to invest in London if you have the cash, Central London is one of the most iconic areas of London.  

    Home to locations like the West End, Buckingham Palace, Big Ben, and Parliament, Central London is one of the best places to live for professionals. 

    With access to fantastic business opportunities, unrivalled transport links, restaurants, and sights to see, Central London is one of the most desired UK locations with over one and a half million residents. 

    However, according to Zoopla, these attributes come at a premium, with average house prices valued at a staggering £2.67 million. 

    Although these costs are high, rent is also huge at £7,842 PCM. 

    However, this high rental income isn’t enough to offset the staggering costs, with rental yields in Central London valued at just 3.51%, making it one of the lowest rental returns in the UK. 

    Prices and returns can get even worse depending on where you go. A property in the illustrious West End, for instance, can set you back a staggering £3,556,263 with returns of just 2.67%. 

    Due to these prices, Central London is typically not considered the best area to invest in London for the average property investor.

    Avg. House Price: £817,050 

    Avg. Gross Rental Yield: 3.03% 

    Capital Growth Since 2011: 48.15% 

    Another area to consider when asking where to invest in property in London is in the North. 

    North London is a popular spot for London property investments and is considered one of the best areas to invest in London. 

    Like Central London, North London has plenty to offer residents with access to London Zoo, Lord’s Cricket Ground, Regent’s Park, Madame Tussauds, and more. 

    The region is made up of popular boroughs like Enfield, Hackney, Islington, and Westminster. 

    You can expect average property prices here of around £817,050, with rental income valued at £2,064 PCM. 

    This puts rental yields in the region at around 3.03%. 

    Again, like many places on this list, London is not ideal for the average property buyer, so it will likely not be one of the best places to buy London property for you. 

    Avg. House Price: £1,790,982 

    Avg. Gross Rental Yield: 3.44% 

    Capital Growth Since 2011: 51.59% 

    West London is another popular spot for London property investments, depending on the borough/area. 

    Richmond Upon Thames, for instance, is expensive, with an average price of £584,078 for a two-bed flat. 

    If you’re looking to invest in London West and get the most out of your money, then boroughs like Hillingdon are your better option. 

    Harlington, based in Hillingdon, has an average value of £221,021 for one-bedroom flats and offers returns of 4.70% 

    While this is still high compared to the cost of a flat in the North of the UK, it’s about as low as you’re likely to find when investing in London property. 

    Overall, you can expect rental yields of just 3.44% in West London, perhaps making it one of the best places to buy London property. 

    Avg. House Price: £691,294 

    Avg. Gross Rental Yield: 3.53% 

    Capital Growth Since 2011:  60.60% 

    South London is another area which many are considering the best place to invest in London. 

    Of course, like other London areas, the specific part of South London you choose to invest in plays a significant role in the success of your London investment. 

    For example, Thamesmead is seen as an excellent place to invest in London property with high yields of 4.20%. 

    Thamesmead is a popular residential area and offers average property prices of £325,457, according to Zoopla. 

    Croydon, another South London area, is a popular choice for investment in London. 

    Here, property prices are expected to see some of London’s highest growth, with extensive regeneration underway. 

    Properties in Croydon can generate a yield of 4.74% for a two-bedroom flat. 

    Overall, like other regions, South London’s average rental yield is relatively low at around 3.53%. 

    Due to the lower London property prices here, South London is widely considered one of London’s best areas to invest in. However, prices here are still hugely expensive. 

    Avg. House Price: £589,351 

    Avg. Gross Rental Yield: 4.11% 

    Capital Growth Since 2011:  61.62% 

    East London is considered one of the best areas to invest in London. 

    Home to popular borough Barking and Dagenham, properties in this area are more affordable than in some other parts of the city, making this a good option for those looking to invest in London with a budget in mind. 

    You can get a property in the borough for around £341,982, with returns valued at an excellent 4.78%. 

    East London is also home to Ilford and Romford, two popular areas for investment in London. 

    Rental yields in these areas are higher than you would find elsewhere in London, with Ilford’s IG11 postcode being able to generate yields of 4.88%, and Romford’s RM9 postcode offering 4.45% yields. 

    Due to this combination of higher yields and lower property prices, East London is one of the top places to buy London property. 

    Central London

    Avg. House Price: £2,677,565 

    Avg. Gross Rental Yield: 3.51% 

    Capital Growth Since 2011:  61.62% 

    Undoubtedly one of the best areas to invest in London if you have the cash, Central London is one of the most iconic areas of London.  

    Home to locations like the West End, Buckingham Palace, Big Ben, and Parliament, Central London is one of the best places to live for professionals. 

    With access to fantastic business opportunities, unrivalled transport links, restaurants, and sights to see, Central London is one of the most desired UK locations with over one and a half million residents. 

    However, according to Zoopla, these attributes come at a premium, with average house prices valued at a staggering £2.67 million. 

    Although these costs are high, rent is also huge at £7,842 PCM. 

    However, this high rental income isn’t enough to offset the staggering costs, with rental yields in Central London valued at just 3.51%, making it one of the lowest rental returns in the UK. 

    Prices and returns can get even worse depending on where you go. A property in the illustrious West End, for instance, can set you back a staggering £3,556,263 with returns of just 2.67%. 

    Due to these prices, Central London is typically not considered the best area to invest in London for the average property investor.

    North London

    Avg. House Price: £817,050 

    Avg. Gross Rental Yield: 3.03% 

    Capital Growth Since 2011: 48.15% 

    Another area to consider when asking where to invest in property in London is in the North. 

    North London is a popular spot for London property investments and is considered one of the best areas to invest in London. 

    Like Central London, North London has plenty to offer residents with access to London Zoo, Lord’s Cricket Ground, Regent’s Park, Madame Tussauds, and more. 

    The region is made up of popular boroughs like Enfield, Hackney, Islington, and Westminster. 

    You can expect average property prices here of around £817,050, with rental income valued at £2,064 PCM. 

    This puts rental yields in the region at around 3.03%. 

    Again, like many places on this list, London is not ideal for the average property buyer, so it will likely not be one of the best places to buy London property for you. 

    West London

    Avg. House Price: £1,790,982 

    Avg. Gross Rental Yield: 3.44% 

    Capital Growth Since 2011: 51.59% 

    West London is another popular spot for London property investments, depending on the borough/area. 

    Richmond Upon Thames, for instance, is expensive, with an average price of £584,078 for a two-bed flat. 

    If you’re looking to invest in London West and get the most out of your money, then boroughs like Hillingdon are your better option. 

    Harlington, based in Hillingdon, has an average value of £221,021 for one-bedroom flats and offers returns of 4.70% 

    While this is still high compared to the cost of a flat in the North of the UK, it’s about as low as you’re likely to find when investing in London property. 

    Overall, you can expect rental yields of just 3.44% in West London, perhaps making it one of the best places to buy London property. 

    South London

    Avg. House Price: £691,294 

    Avg. Gross Rental Yield: 3.53% 

    Capital Growth Since 2011:  60.60% 

    South London is another area which many are considering the best place to invest in London. 

    Of course, like other London areas, the specific part of South London you choose to invest in plays a significant role in the success of your London investment. 

    For example, Thamesmead is seen as an excellent place to invest in London property with high yields of 4.20%. 

    Thamesmead is a popular residential area and offers average property prices of £325,457, according to Zoopla. 

    Croydon, another South London area, is a popular choice for investment in London. 

    Here, property prices are expected to see some of London’s highest growth, with extensive regeneration underway. 

    Properties in Croydon can generate a yield of 4.74% for a two-bedroom flat. 

    Overall, like other regions, South London’s average rental yield is relatively low at around 3.53%. 

    Due to the lower London property prices here, South London is widely considered one of London’s best areas to invest in. However, prices here are still hugely expensive. 

    East London

    Avg. House Price: £589,351 

    Avg. Gross Rental Yield: 4.11% 

    Capital Growth Since 2011:  61.62% 

    East London is considered one of the best areas to invest in London. 

    Home to popular borough Barking and Dagenham, properties in this area are more affordable than in some other parts of the city, making this a good option for those looking to invest in London with a budget in mind. 

    You can get a property in the borough for around £341,982, with returns valued at an excellent 4.78%. 

    East London is also home to Ilford and Romford, two popular areas for investment in London. 

    Rental yields in these areas are higher than you would find elsewhere in London, with Ilford’s IG11 postcode being able to generate yields of 4.88%, and Romford’s RM9 postcode offering 4.45% yields. 

    Due to this combination of higher yields and lower property prices, East London is one of the top places to buy London property. 

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    Potential For Future Growth With Investment Opportunities London Potential For Future Growth With Investment Opportunities London

    Potential for Future Growth With Investment Opportunities London 

    While the opportunities for property investment in London aren’t looking particularly promising, some areas are worth considering. 

    Several areas in London are expected to experience property growth in the coming years. 

    Whitechapel, Canary Wharf, Earls Court, Old Oak Park, and Croydon are all predicted to make their mark on the property map and make perfect choices if you’re wondering where to invest in London property. 

    This is due to several regeneration projects, with plans for improved transport links and the creation of thousands of new homes and jobs. 

    Select London investment properties have been predicted to reach rental yields as high as 6%.  

    Up and Coming London Location

    Exclusive London Investment

    Desirable London Investment Opportunity

    London Prices from £375,000

    Yields Available on Request

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    West Quay Royal Arsenal

    Multi-Billion GBP Regeneration Zone

    London Prices from £390,000

    7 Mins from London City Airport

    Riverside Living in the Heart of London

    Prime London Investment

    Birch House

    Award-Winning Architecture

    London Prices from £450,000

    Low-Priced London Investment

    A Modern Escape from City Life

    Alternatives to London Property Investment Alternatives to London Property Investment

     

    Chapter 4: Alternatives to London Property Investment 

    In the penultimate chapter of our guide, we will be looking at alternatives to London property investment in the UK. 

    Here, you will find more affordable and higher returning options that compete with property investment in London. 

    You’ll learn more about the South East, North West, and West Midlands options performing well in the 2021/22 property market.  

    Key topics: 

    • London vs Luton 
    • London vs Liverpool and Manchester 
    • London vs Birmingham 
    • FAQs about property investment in London 
    The Hive The Hive
    View Property

    Luton: An Alternative to London Property Investment 

    One of the primary motivators behind investors choosing to buy London property is the vast rental demand in the city.

    Naturally, with a large portion of the population focused on London, demand for property is vast.

    But wouldn’t it be great if you could tap into this rental market demand without having to pay London property prices?

    Well, likely the best way to do this is to invest in a commuter town. Commuter towns are popular with London workers who cannot afford the sky-high prices offered by London.

    Property Price Growth London vs Luton Property Price Growth London vs Luton

     

    Currently, London’s best commuter town is Luton.  

    Voted the best commuter town for two consecutive years by estate agents Jackson-Stops and voted the best place to invest for first time buyers in 2021, Luton is a fascinating investment solution for London investors in 2021/22. 

    The Bedfordshire town outperforms London in every aspect of capital growth potential. While gross rental yields are slightly lower than in the capital, you can find world-class Luton investment property like The Hive with huge 5% NET returns.   

    The town is also only 22 minutes away from Central London, making it incredibly popular for young professionals. 

    You can learn all about Luton property investment and eight reasons you should invest in the town in our complete 2021 guide. Just click the link to read more.  

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    Embankment Exchange Embankment Exchange
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    How Does Property Investment London Compare to the North West? 

    We know that London property investments in certain areas can offer a level of return on investment and some expected growth over the years to come. 

    But what about those who don’t wish to wait for growth and want to benefit from the highest yields possible? 

    The North of England has gained a positive reputation throughout the property market as of late.  

    Property Investment In London Compared With the North West Property Investment In London Compared With the North West

     

    Comfortably the best places to invest in property UK, Liverpool and Manchester boast some of the best market statistics in 2021. 

    Outperforming property investment in London through capital growth, affordability, and rental yields, the cities currently boast some of the most lucrative property investment strategies. 

    Affordability is especially vital for the North West’s superiority over buy to let London opportunities. 

    To make the divide between North and South a little clearer, all you need to do is consider what type of investment properties London offers for the same price up North. 

    Put £500,000 towards a London investment, and you can barely purchase a standard one-bedroom apartment on Zoopla. 

    Whereas, you could buy a five-bedroom house with a large garden and driveway for the same price in Liverpool. 

    The prices of the properties at RWinvest are proof enough that Liverpool and Manchester offer some of the best deals, with our pioneering eco property, ELEMENT – The Quarter starting from just £74,950. 

    Look towards London off-plan property, and you’d definitely struggle to find a price anywhere close to this. 

    While London property investments and London investment property are incredibly popular amongst overseas investors, more and more people are choosing to invest in the North West thanks to the high potential on offer. 

    You can learn more about Liverpool property investment and Manchester property investment by clicking the links. 

    Invest in the King of Capital Growth 

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    East & Green East & Green
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    How Does Property Investment London Compare to Birmingham?

    As the UK’s second city, you would be forgiven to think London buy to let opportunities outperform those in Birmingham.

    But dig a little below the surface, and you will see that Birmingham property is offering far more lucrative investments in 2021.

    Outperforming London in every measurement except 20-year growth, Birmingham is providing an exciting strategy in 2021.

    With tonnes of regeneration on the way, including the introduction of 80,000 new jobs via HS2 and the Birmingham Big City Plan, the future of the West Midlands city is incredibly bright. 

    Property Investment London Compared With Birmingham Property Investment London Compared With Birmingham

     

    You can learn all about Birmingham property investment by clicking the link and reading our updated guide for 2021. 

    Get Access to Fantastic Birmingham Property With Only £50k Needed Today 

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    FAQs

    According to most market statistics, it is not a good time to invest in London. As of August 2021, rental prices in the region have dropped by the sharpest annual pace since 2010, with a drop of 0.4%.

    Property prices have also dropped by 13.13% between June 2020 and June 2021, according to the UK House Price Index.

    If you want to buy investment property in London and other major UK cities, contact RWinvest today. Our investment property starts from just £59,950.

    Based on the latest market statistics, buying a house in London isn’t the best investment you can make. This is because property prices are costly, with a 2-bed house valued at £680,360 on Zoopla. London’s capital growth is also the lowest in the UK, with a 12.4% growth predicted by 2025.

    Yes, property is a good investment in the UK. This is because you earn two types of income through rent and capital appreciation. House prices are set to rise by 21.5% in the UK by 2025, with rent set to increase by 17%. 

    According to Savills, after house prices fell between 2020 and 2021, London house prices are expected to recover with a growth of 7.0% in 2021 

    It’s estimated that to live in London comfortably for one person, you will need to earn a salary of around £40,000 a year.

    Despite Covid-19 and Brexit pressures, the housing market is highly unlikely to crash in 2022. In fact, Savills estimates that the average UK property will increase in value by up to 4.5% in 2022. 

    Yes, it is a good time to buy a house in the UK property marketThis is because rent is currently the highest it has ever been at £1,061, according to HomeLet. According to Savills, house prices are also increasing strongly, with predictions of a 9.0% rise in prices in 2021. 

    Is it a Good Time to Invest in London Property?

    According to most market statistics, it is not a good time to invest in London. As of August 2021, rental prices in the region have dropped by the sharpest annual pace since 2010, with a drop of 0.4%.

    Property prices have also dropped by 13.13% between June 2020 and June 2021, according to the UK House Price Index.

    Where Can I Buy Investment Property in London?

    If you want to buy investment property in London and other major UK cities, contact RWinvest today. Our investment property starts from just £59,950.

    Is Buying a House in London Worth It?

    Based on the latest market statistics, buying a house in London isn’t the best investment you can make. This is because property prices are costly, with a 2-bed house valued at £680,360 on Zoopla. London’s capital growth is also the lowest in the UK, with a 12.4% growth predicted by 2025.

    Is Property a Good Investment UK?

    Yes, property is a good investment in the UK. This is because you earn two types of income through rent and capital appreciation. House prices are set to rise by 21.5% in the UK by 2025, with rent set to increase by 17%. 

    Will House Prices Fall in London?

    According to Savills, after house prices fell between 2020 and 2021, London house prices are expected to recover with a growth of 7.0% in 2021 

    How Much Salary Do You Need to Live in London?

    It’s estimated that to live in London comfortably for one person, you will need to earn a salary of around £40,000 a year.

    Will the Housing Market Crash in 2022?

    Despite Covid-19 and Brexit pressures, the housing market is highly unlikely to crash in 2022. In fact, Savills estimates that the average UK property will increase in value by up to 4.5% in 2022. 

    Is 2021 a Good Year to Buy a House?

    Yes, it is a good time to buy a house in the UK property marketThis is because rent is currently the highest it has ever been at £1,061, according to HomeLet. According to Savills, house prices are also increasing strongly, with predictions of a 9.0% rise in prices in 2021. 

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    Investment Property For Sale London Investment Property For Sale London

    Chapter 5: Investment Property for Sale London  

    Looking to start investing in London property? Ready to buy a property in London? Then our final chapter is here for you. 

    Chapter five will help you find the latest investment opportunities in London. 

    If you’re looking to invest in London and want to find the latest investment properties in London and the wider South East area, then keep reading for more information. 

    Key topics: 

    • Investment Property for sale in London 
    • Best property investment London opportunities 
    • Exclusive London investments 

    Get the Latest Investment Property for Sale London With RWinvest 

    Here at RWinvest, we have several exciting buy to let properties for sale in London. 

    With prices starting from just £179,950, you can buy property in London, Luton, and South East areas, with up to 5% returns. 

    Our investment properties in London and the wider South East area include: 

    • The Hive – Revolutionary Luton investment property from £179,950. 
    • West Quay Royal Arsenal – London property investment from £390,000. 
    • Birch House – Award-winning property investment in London for £450,000. 
    • Centrum Court – Spacious investment property in London apartments for £410,000. 

    Just click the links to learn more about these excellent exclusive London property investments today. 

    Up and Coming London Location

    Exclusive London Investment

    Desirable London Investment Opportunity

    London Prices from £375,000

    Yields Available on Request

    Invest With £60,000

    New London Opportunity

    West Quay Royal Arsenal

    Multi-Billion GBP Regeneration Zone

    London Prices from £390,000

    7 Mins from London City Airport

    Riverside Living in the Heart of London

    Prime London Investment

    Birch House

    Award-Winning Architecture

    London Prices from £450,000

    Low-Priced London Investment

    A Modern Escape from City Life

    Who is RWinvest?

    Ready to make your UK property investment? Then RWinvest is the company for you. 

    We are an award-winning property investment company with over 17 years of experience in residential and student property. 

    With offices all around the country – in both Northern and Southern cities such as Liverpool and London – we at RWinvest are ideally placed to give you the best information to help you in your investment journey. 

    Contact our team now to get started. 

    Please also check out our London property market forecast to view the latest property news and updates within the London area, and read our blog post on what’s happening to the London rental market in 2022.

    Invest today from just £74,950 and get access to huge 8% NET rental yields. 

    Daniel Williams
    Daniel Williams
    Senior Property Writer

    Daniel Williams is a senior property writer at RWinvest. Regularly publishing in-depth articles on topics such as the best investment areas in the UK and guides on how to invest, Daniel has a keen eye for statistics and analysing property market changes.

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