By Patrick Vernon
London’s position as the economic and cultural heart of the UK means that it continues to be a desirable place to buy property for investors elsewhere in the country and, indeed, the world. Whether it’s the lure of leisure or the pull of employment, there are many reasons to want to own a home in the capital.
But, if you haven’t grown up in London, what should you look out for? Here’s our guide to what you must consider as you look to buy your house…
Not ‘one London’
Greater London is a 600 square mile area that is home to eight million people. It’s not one easily defined city with a single set of characteristics. When it comes to buying a house this means you need to consider that there are many interlocking and interacting mini markets within London.
New developments, infrastructure improvements and fashion trends can impact on different parts of the capital in different ways. Shake off any notion that you’re looking for a house in London and start researching exactly which part of the capital you actually want to purchase a property in. Ideally, you want to try to discover the next big areas for development, not the ones that have already reached their peak.
Transport is more important in London than any other city in the UK. It gives any property a boost to be ‘well-connected’ but in London, this can be crucial. Your London Underground zone, proximity to a Tube station and bus and rail connections all affect house prices.
You only need to look at the impact of the Crossrail project on the house prices in areas around stations to see why it matters. Think about how you’ll commute/get around in London – but also consider what projects are on the horizon and how they might impact on a property’s value. With Crossrail, HS2 and the on-going debate over airport expansion for London, you need to be on top of the latest developments and their effects on your housing asset.
Yes, prices are high. That’s a given in London. But, there is still big growth potential. It might cost a lot to purchase a property in the capital but if it’s worth 15 per cent more, say, within a year you’ll be in possession of an asset that earns you far more than placing your money in a savings account. Buy the best house in the best possible location and you’ll get great value for your outlay.
You might have a set vision of London in your head and it’s probably not a correct one. Just because it’s a city doesn’t mean you’ll have to compromise when it comes to size, number of bedrooms or a garden, for example. Just spend some time looking at FT Property Listings and you’ll realise that some of the nicest homes in the UK are actually situated in London. You might have to pay to get it, but there is a lot of quality on the market.
Estate agents make a lot of money in London and have benefitted from the capital’s earning potential. The agents themselves do not always come with the greatest reputation. It’s important for a non-Londoner to realise that the capital is a cut-throat market. Not all agents are as bad as the extreme cases you may have heard of but if you’re looking to let a property out, for example, you’d be a fool not to check your terms and conditions.
As a non-Londoner, you need to go into a property search with your eyes open. Conduct a search within one or two parts of the capital and make sure you’re aware of the transport and infrastructure developments, for good and bad. Don’t be naïve about cost or the competitive estate agent market – but also make sure you spot the opportunities to make money as well as spend.
Feature image credit: Bellway