Property Investment London

England’s capital city sees vast numbers of tourists, overseas workers, graduates and investors heading there every year.

  • London is forecast an 18.8% increase in rental values between 2020 and 2024
  • The city had a GDP per capita of £56,199 in 2019
  • House prices in London have increased by 14.29% in 5 years

Overview

London is the capital city of England. It is full of cultural and historical attractions, including Buckingham Palace, the Houses of Parliament, the London Eye and Tower Bridge, to name just a few. The London Underground is an integral part of the city, providing a rapid, comprehensive transport system covering the entire region.

London is one of the leading financial centres of the world, serving as a particularly important location for international banking and finance. The finance sector, predominantly based in the City of London and Canary Wharf, is the bedrock of the city’s economic strength, helping to stimulate huge growth in the region.

Furthermore, regeneration schemes across the city aim to satisfy the growing demand for city-centre living, with many boroughs enjoying exciting new developments.

Why Invest In London?

London is a complex place to invest. It is not currently somewhere to invest if you are looking for very attractive yields. Furthermore, it is the highest value part of the country in terms of property prices and as such investing is very expensive, especially when you factor in your one-off cost of stamp duty.

However, it’s a different story when you look at what London has to offer by way of capital growth. For example, if you had bought a property for £430,000 in Q1 of 2014, then this year it would potentially be worth £526,046 (Nationwide HPI).

That is excellent capital growth and creates an unparalleled return on investment, especially after factoring in the rent you would have been receiving over the years.

Types of Property Investment in London

Buy-To-Let

Buy-to-let in London is a strong investment strategy, given the capital’s huge rental demand.

Properties will never be short of tenants who are willing to pay a premium price to have close access to workplaces and the city’s amenities.

Buy-to-let yields tend to be tighter the closer to the centre as prices are higher, but there’s still value to be had by venturing further out.

Ultimately, property investment in London is all about picking the right location to balance yield and capital growth.

Commercial

Commercial real estate can be a brilliant investment, especially in London which serves as a popular destination for companies to set up shop.

This mode of occupancy is particularly attractive as commercial tenants tend to secure long-term, full repairing leases (FRI), so the rent received is net of maintenance and operating expenses.

Prime yields for commercial property in London averaged between 4% to 4.75% at the end of 2018.

Popular Areas

If you are unfamiliar with London but you’re looking to invest in the city, we recommend getting familiar with all the different areas. Below, we’ve picked out three areas we consider the best for property investment in London.
Central London

Central London is home to some of the most expensive property in the world. Investors must bear this in mind as it typically means rental yields are lower. For example, an area like Mayfair can offer as little as 1.5%.

However, our own research shows such properties tend to enjoy the highest rates of long-term capital growth in the country, so any choice depends on an investor’s budget and objectives. Many investors seek a balance between the two by looking slightly further afield for properties that still offer easy access to the centre, but at a more affordable price and with better yields.

East London
East London typically offers more affordable property prices and stronger yields. Even premium, inner-district locations such as Canary Wharf can achieve a 4.1% yield. However, further out there are even stronger results to be found, with Foxtons reporting rental yields of 6.4% in Barking and Dagenham.
South London
Promising yields can be achieved in South London. Similar to other areas, the further out you go, the more prices reduce and yields can increase. Areas such as Wallington and Mitcham can offer yields of around 4.7%. If you delve a little deeper and search hyper-locally then you can find great investment opportunities, such as Merton, which has been known to achieve yields around 6.3% (Foxtons).
Other areas

The other areas of London (North and West) also have good places for investing and they are worth looking into. For more information on these areas, please feel free to get in touch.

 

Future Growth in London

18% House Price Increase in prime central London by 2024 – Knight Frank
2.8% GVA growth rate 2020-2021 – GLA
17.1% Rental growth (over 5 years) - JLL
9.54 million Forecasted London population in 2026 – London.gov.uk

Frequently Asked Questions

Below you can find a range of common questions from previous investors. If you require specific details and advice please do not hesitate to contact us today on +44 203 627 3987 or via [email protected].

Typically, London prices do very well over the long term. For example, after the last major global financial crash in 2008, they excelled. Savills published that between 2007 and 2017, London property prices grew by 63.5%. The average across the rest of the UK was only 15.8%, for comparison.
According to Zoopla (September 2021), the average price paid for a property in London is £706,267. The average price paid for a flat is £526,041.
London house prices has increased by 14.29% in the last 5 years (Zoopla June 2020). Hometrack’s latest report shows house prices have increased 1.1% between April 2019 – April 2020.
Realistically, you will generally get better yields when investing further north (such as Birmingham, Leeds, Liverpool and Manchester), as initial purchase prices and stamp duty will be considerably lower in comparison to London. That said, if you pick certain areas of London, you can find quite good yields, but it isn’t easy. Totally Money’s buy-to-let yield map reports that London’s E12 postcode can achieve yields of 6.04%.
The HS2 will efficiently connect London with the Northern Powerhouses and will cut the commute time to and from these place. London Euston Station will be one of the stations along with Old Oak Common which is a new super hub and set to be the best-connected rail station in the UK.
“With the current prices in London it is hard to get a good yield or ROI in comparison to investing up north and prices don’t seem to be really increasing any time soon. That said, there are some areas to look out for with regeneration projects in the pipeline that means they are likely to experience good capital growth.” – Tobi Mancuso, Director.

Featured Developments

The Chocolate Factory, Bristol

Status: Off-Plan
Type: Residential
Price: £260,382

Throstle Nest, Eccleshill

Status: Complete
Type: Residential
Price: £230,000

Portside Place, Liverpool

Status: Off-Plan
Type: Residential
Price: £177,500
gibson quay, liverpool

Gibson Quay, Liverpool

Status: Off-Plan
Type: Residential
Price: £142,500
Piccadilly Mews, Manchester

Piccadilly Mews, Manchester

Status: Conversion
Type: Residential
Price: £150,000
Gladstone Mews, Liverpool

Gladstone Mews, Liverpool

Status: Off-Plan
Type: Residential
Price: £135,000
Deakin's Yard

Deakin’s Yard

Status: Off-Plan
Type: Student Accommodation
Price: £78,500
the exterior of talbot house in manchester

Talbot House, Manchester

Status: Off-Plan
Type: Residential
Price: £189,000
Hawkins Court, Northampton

Hawkins Court, Northampton

Status: Off-Plan
Type: Residential
Price: £174,000
The Baths, Macclesfield

The Baths, Macclesfield

Status: Off-Plan
Type: Residential
Price: £250,000
Sovereign Point, Liverpool

Sovereign Point, Liverpool

Status: Off-Plan
Type: Residential
Price: £169,500
Sapphire Court, Birmingham

Sapphire Court, Birmingham

Status: Off-Plan
Type: Residential
Price: £198,000
Rawson’s Mill Halifax

Rawson’s Mill Halifax

Status: Off-Plan
Type: Residential
Price: £117,500
Smithfield Lofts, Birmingham

Smithfield Lofts, Birmingham

Status: Off-Plan
Type: Residential
Price: £199,995
Swan Courtyard, Birmingham

Swan Courtyard, Birmingham

Status: Off-Plan
Type: Residential
Price: £182,995
Swan View, Birmingham

Swan View, Birmingham

Status: Off-Plan
Type: Residential
Price: £183,750
The Centrium, West Bromwich

The Centrium, West Bromwich

Status: Off-Plan
Type: Residential
Price: £152,900
The Green, Croydon

The Green, Croydon

Status: Off-Plan
Type: Residential
Price: £455,000
Solihull Apartments

Solihull Apartments

Status: Complete
Type: Residential
Price: £152,900
Sir Barnes Wallis Court, Derbyshire

Sir Barnes Wallis Court, Derbyshire

Status: Complete
Type: Residential
Price: £230,000
Fleet Corner, Swindon

Fleet Corner, Swindon

Status: Complete
Type: Residential
Price: £121,125
Berkeley Square, Manchester

Berkeley Square, Manchester

Status: Off-Plan
Type: Residential
Price: £248,091
Azizi Venice, Dubai

Azizi Venice, Dubai

Status: Off-Plan
Type: Residential
Price: £129,912
Avenue Residence 5, Dubai

Avenue Residence 5, Dubai

Status: Off-Plan
Type: Residential
Price: £230,568
Samana Portofino, Dubai

Samana Portofino, Dubai

Status: Off-Plan
Type: Residential
Price: £150,057
Binghatti Amber, Dubai

Binghatti Amber, Dubai

Status: Off-Plan
Type: Residential
Price: £159,525
SO / Uptown, Dubai

SO / Uptown, Dubai

Status: Off-Plan
Type: Residential
Price: £403,095
Creek Waters 2, Dubai Creek Harbour

Creek Waters 2, Dubai Creek Harbour

Status: Off-Plan
Type: Residential
Price: £369,463 approx
Azizi Riviera Phase 4

Azizi Riviera Phase 4

Status: Off-Plan
Type: Residential
Price: £160,000
Luma22, JVC, Dubai

Luma22, JVC, Dubai

Status: Off-Plan
Type: Residential
Price: £138,204
Hadley Heights, Dubai

Hadley Heights, Dubai

Status: Off-Plan
Type: Residential
Price: £224,741
Azizi Vista, Dubai

Azizi Vista, Dubai

Status: Off-Plan
Type: Residential
Price: £127,179
Beverly Boulevard

Beverly Boulevard

Status: Off-Plan
Type: Residential
Price: £112,000
Ritz-Carlton Residences

Ritz-Carlton Residences

Status: Off-Plan
Type: Residential
Price: £1,291,080
MAG 330, Dubai

MAG 330, Dubai

Status: Off-Plan
Type: Residential
Price: £145,476
Viewz by Danube Dubai

Viewz by Danube Dubai

Status: Off-Plan
Type: Residential
Price: £329,250
Laya Heights, Dubai

Laya Heights, Dubai

Status: Complete
Type: Residential
Price: £100,000
Mirdif Hills, Dubai

Mirdif Hills, Dubai

Status: Complete
Type: Residential
Price: £274,628 approx
Belmont Residences, JVT

Belmont Residences, JVT

Status: Off-Plan
Type: Residential
Price: £312,673 approx
Seslia Tower, JVT

Seslia Tower, JVT

Status: Complete
Type: Residential
Price: £114,000
Residence 110, Business Bay

Residence 110, Business Bay

Status: Complete
Type: Residential
Price: £402,480
Azizi Beach Oasis, Dubai

Azizi Beach Oasis, Dubai

Status: General
Type: Residential
Price: £110,000
Kensington Waters, Dubai

Kensington Waters, Dubai

Status: Complete
Type: Residential
Price: £156,170
Ciel Tower, Dubai

Ciel Tower, Dubai

Status: General
Type: Hotel
Price: £417,900
The One Hotel, JVC Dubai

The One Hotel, JVC Dubai

Status: Off-Plan
Type: Residential
Price: £417,900
The Crest, Dubai

The Crest, Dubai

Status: General
Type: Residential
Price: £220,330
SLS Hotel and Residences Dubai

SLS Hotel and Residences Dubai

Status: Complete
Type: Residential
Price: £258,383
Harrington House, Dubai

Harrington House, Dubai

Status: General
Type: Residential
Price: £159,948
Marquise Square, Dubai

Marquise Square, Dubai

Status: Off-Plan
Type: Residential
Price: £180,585
Six Senses Residences, Dubai

Six Senses Residences, Dubai

Status: Off-Plan
Type: Residential
Price: £5000
DAMAC Lagoons, Dubai

DAMAC Lagoons, Dubai

Status: General
Type: Residential
Price: £342,395
Golf Gate, Dubai

Golf Gate, Dubai

Status: Complete
Type: Residential
Price: £145,418
Cavalli Tower, Dubai

Cavalli Tower, Dubai

Status: Off-Plan
Type: Residential
Price: £2,372,955
Sir Barnes Wallis Court

Sir Barnes Wallis Court

Status: Complete
Type: Residential
Price: £230,000
St. Regis Residences

St. Regis Residences

Status: General
Type: Residential
Price: £433,027
Dubai Creek Harbour

Dubai Creek Harbour

Status: Complete
Type: Residential
Price: £258,771
Arabian Ranches III

Arabian Ranches III

Status: Off-Plan
Type: Residential
Price: £382,580
Creek Vistas Reservé

Creek Vistas Reservé

Status: Complete
Type: Residential
Price: £162,000

Ellington House, Dubai

Status: Off-Plan
Type: Residential
Price: £336,032

Cloud Tower, Dubai

Status: Off-Plan
Type: Residential
Price: £107,847

Peninsula, Dubai

Status: General
Type: Residential
Price: £146,000

Waves Grande, Dubai

Status: Off-Plan
Type: Residential
Price: £237,460

FIVE JVC, Dubai – Luxury Hotel Investment

Status: Complete
Type: Residential
Price: £495,446

FIVE Luxe, Luxury Hotel Investment

Status: Off-Plan
Type: Hotel
Price: £735,000

Azizi Riviera Beachfront

Status: Off-Plan
Type: Residential
Price: £200,000

Emaar Rove City Walk Hotel

Status: Complete
Type: Hotel
Price: £153,960
Manchester Mill

Manchester Mill

Status: Conversion
Type: Residential
Price: £150,000
Bastion Point, Liverpool

Bastion Point, Liverpool

Status: Off-Plan
Type: Residential
Price: £124,950
Digbeth One_2, Birmingham

Digbeth One_2, Birmingham

Status: Complete
Type: Residential
Price: £228,000
Guildhall Gardens, Preston

Guildhall Gardens, Preston

Status: Off-Plan
Type: Residential
Price: £117,995
Vision, Manchester

Vision, Manchester

Status: Off-Plan
Type: Residential
Price: £170,286
Kiln House, Stoke-on-Trent

Kiln House, Stoke-on-Trent

Status: Complete
Type: Student Accommodation
Price: £69,950
Plough Maltings, Burton-upon-Trent

Plough Maltings, Burton-upon-Trent

Status: Off-Plan
Type: Conversion
Price: £78,222
Lincoln House, Bolton

Lincoln House, Bolton

Status: Complete
Type: New Build
Price: £101,500
The Villas, Stoke-on-Trent

The Villas, Stoke-on-Trent

Status: Conversion
Type: Student Accommodation
Price: £74,950
Cavendish Waters, Liverpool

Cavendish Waters, Liverpool

Status: Off-Plan
Type: Residential
Price: £152,000
The Lyceum, Manchester

The Lyceum, Manchester

Status: Off-Plan
Type: Residential
Price: £185,570
Queens Square, Croydon

Queens Square, Croydon

Status: Off-Plan
Type: Residential
Price: £378,360

News & Articles

Dubai Weekly Property News Round Up – 13.07.24

Date: July 16, 2024

Weekly Property News Round Up – 13.07.24

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