However, this growth in London property prices comes with a decline in rental prices. In February 2017, the average rental property in London was let for around £1,280, presenting a one per cent decrease year on year. High property prices and lower rent means one thing for investors — some disappointing average rental yields. Those investing in off-plan property in London can expect yields at an average of 3.7 per cent, which is a lot lower than some other areas of the UK.
While the opportunities for property investment London offers aren’t looking particularly promising, things are starting to look up in the future. Several areas in London are expected to experience property growth by 2020. Whitechapel, Canary Wharf, Earls Court, Old Oak Park and Croydon are all predicted to make their mark on the property map. This is due to several regeneration projects set in place for the city, with plans for improved transport links and the creation of thousands of new homes and jobs. London has been predicted to reach rental yields as high as six per cent by 2020.
What are the best places to invest in property London?
Some of the best areas for London property investment include Ilford, Romford, Barking, Dagenham, Hayes, Harlington, and Thameshead. This is because these areas currently offer average rental yields of 5 per cent and above.
Although still more expensive than elsewhere in the UK, property prices in these areas tend to be more affordable than in other London boroughs. Since these areas – like many in London – see high levels of demand, rental costs can remain high, which allows property investors to benefit from more attractive yields. This is the main reason why market research is so vital, especially if you want to find out how to invest in London property and make a healthy profit.
While these areas make a solid choice for property investment in London for 2019, it’s always worth looking ahead into the future. As mentioned above, some areas in London, such as Earls Court and Croydon, are expected to see growth by 2020, making them good areas to invest in, allowing capital growth to improve along with rental yields.