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Best Property Investments in London: 2020

In recent years, the London property market has proven extremely attractive to both domestic and international investors. While property can create returns through value appreciation, Buy-to-Let investments generate stable value through their rental yields. Thanks to London’s popularity with investors, properties have benefited from sustained growth in rental value. 


If you’re feeling a little overwhelmed by the choice and perhaps hesitant in making any decision at all, relax and read on for an up to date summary of some of the best property investments in London today, in 2020.

East

Hackney

Average Price:

£626,095

Average Rental Yield:

4.82%

This well known trendy corner of London is home to a variety of city workers and young families. Containing London’s tech hub – Silicon Roundabout and sandwiched just between hipster Shoreditch and busy Old Street.

Cheaper than neighbouring Islington, with plenty of green spaces there are multiple development projects going on. Centred around an overhaul of transport infrastructure, key sites and public spaces, prospective stakeholders can be sure Hackney is one to watch when it comes to property investments in London.

Barking & Dagenham

Average Price:

£318,527

Average Rental Yield:

5.4%

London’s cheapest place to buy whilst providing the best rental yields in the city. Barking & Dagenham conveniently sits just 25 minutes from central London, close to the M25 and City Airport, with Crossrail due to open soon. Land and property prices are lower in Barking and Dagenham than the rest of London with huge investment opportunities given its growth potential. 

Expected to be boosted by future regeneration and investment projects, including planning permission having been secured for up to 10,800 new homes, shopping, leisure, community and healthcare facilities at Barking Riverside. Without a doubt, an attractive carrot for property investors in London, and across the globe.

Ilford

Average Price:

£421,226

Average Rental Yield:

5.5%

Also being upgraded to a Crossrail hub, the area will be transformed into a top commuter location with a train every 5 minutes into central London.  Ilford is home to the highest average rental yields on the list, offering great opportunities for property investors in London.

With 2000 new homes to be delivered by 2021 and a skyscraper in the works, average property prices in the borough have increased by nearly 60% in the past 5 years. Prices are still some of the lowest in the capital, a great opportunity for first time investors.

Newham

Average Price:

£445,425

Average Rental Yield:

4.9%

Covering the surrounding areas of the Excel Centre and London City Airport, Newham has seen substantial property price increases and higher rental yields than London’s typical average.  A large part of this growth is down to Newham’s population having increased by more than 80,000 since 2005.

With Stratford’s Olympic Park and London Stadium within the borough, the 2012 Olympics originally put Newham on the map, and the borough has seen significant growth and regeneration ever since. Newham has also become a cultural hub and new jobs and exciting developments keep coming to the area.

Newham has seen significant growth in property prices (49%) over the last five years, so it’s a great choice for buyers seeking a solid investment with good prospects.

Redbridge

Average Price:

£488,632

Average Rental Yield:

5.0%

Offering families good value homes within an easy commute of central London, Redbridge offers investors a chance to potentially see impressive capital growth, outpacing other boroughs by 17% over the next 5 years.

Already a well-connected commuter area, further rail improvements with the new Elizabeth Line will stretch over 60 miles from Reading and Heathrow to Abbey Wood. This will continue to improve Redbridge and boost the local property market. 

As a leafy suburb with almost a quarter covered in award winning parks and forest land and top performing schools, this borough will be very popular with families.

Poplar

Average Price:

£512,000 (up by 15% in the past 5 years)

Average Rental Yield:

4.5%

Served by several Docklands Light Railway stations in Zone 2, Poplar is the more affordable option than neighbouring Canary Wharf. This former victorian slum is getting revamped for the 21st Century with 3000 flats in the pipeline, these will be in new buildings and revived brutalist landmarks with shops, offices and new parks.

With both new builds such as Galliard Homes at Orchard Wharf and period houses available, it has a lot of change on the cards, becoming a magnet for city workers and families alike.

North

Blackhorse Road

Average Price:

£484,000

Average Rental Yield:

4.3%

An up and coming hotspot for startup entrepreneurs and creatives, this borough is changing swiftly with the creation of 2,500 new homes and a need for workspaces and studios.

The streets around Blackhorse Road Tube station are lined with neat terrace houses, originally built for local factory workers which have increased in value significantly over the last 5 years. It’s well connected with good Zone 3 transport links, the Victoria line (arguably the fastest!) and great schools according to Ofstead reports.

Harringey

Average Price:

£445,240

Average Rental Yield:

4.9%

Immensely popular with London renters in their 20s, Haringey offers desirable areas for families, such as Crouch End and Muswell Hill. Harringey also poses as an attractive option for first time buyers when compared with more expensive neighbouring north London areas.

North/West

Kilburn

Average Price:

£662071 - cheaper than surrounding areas of Brondesbury (£823,764) and South Hampstead (£837,797)

Average Rental Yield:

4.5%

Inside Zone 2 making it accessible and a more affordable alternative to Hampstead or Queens Park. With close proximity to the centre of the city and just a walking distance to Regents Park,  it’s an attractive asset for anyone searching for the best property investments in London.

Undergoing a £600 million makeover that aims to reinvent the once run-down district and elevate it to match its much-coveted neighbours. With regeneration projects such as South Kilburn Estate- an ambitious project which sees the replacing of an estate with 2,400 new homes designed by some of the UK’s top architects, giving the area an injection of modern, stylish property to buy, rent or for shared ownership.

South

Merton

Average Price:

£448,504

Average Rental Yield:

6.3%

Encompassing popular areas like Wimbledon and Colliers Wood, Merton offers widespread appeal to both tenants and landlords. 

With regeneration projects such as The Cannons House & Grounds Regeneration Project and Colliers Wood Tower.

Old Kent Rd

Average Price:

£570,000

Average Rental Yield:

6.0%

Teetering on the edge of regeneration for the past several years, a series of massive developments could finally change the fortunes of an area which has for generations been known as a cheap buy on the Monopoly board. Currently a tad on the scruffy side but its future looks increasingly upbeat, with new homes and facilities on the horizon

With great transport links in Zone 1, a real game changer, down the line, will be if Transport for London goes ahead with a planned Old Kent Road station of its own.

West

Hounslow

Average Price:

£497,758

Average Rental Yield:

4.7%

Despite being one of the most expensive boroughs on the list, Hounslow offers larger sized homes for lower prices, which are hard to come by in Greater London. Lots of green space and highly rated schools , making this attractive to family planners

Houses are more affordable in this area due to being under the flight path for Heathrow’s two runways, however could be a great option for those who travel frequently. Hounslow is getting a half million-pound revamp of the Civic Centre and Lampton Road and regeneration of the Hounslow High Street is making the borough an enticing place to live and invest in.

Greater London

Woking

Average Price:

£316,909

Average Rental Yield:

4.8%

A little further out west but growing in popularity as a commuter option, Woking offers more square feet for your money than other boroughs and has no fewer than eight golf courses to choose between!

Guildford

Average Price:

£354,245

Average Rental Yield:

5.7%

Attracting Londoners for quite some time due to its wealth of green spaces and beautiful homes, Guildord could be the perfect choice for savvy investors.

Sutton

Average Price:

£387,286

Average Rental Yield:

4.4%

Extremely popular area among families looking to upsize away from central London, Sutton offers landlords a healthy return on investment. Already seeing more than £410m invested since 2012, the borough forecasts even more investment and development opportunities, encouraging economic growth as Sutton home to more than 6,800 businesses.

Having the perfect balance of practically being in the countryside and yet close proximity to central London certainly makes this an attractive property investment in London.

Summary

An International commercial hub attracting thousands of new residents each year from across the globe, London should witness far more sustained rental demand than comparable investment prospects elsewhere. 

With East firmly in the lead , opportunities for ambitious property investments span far and wide across the South, West and North of the capital too. Despite Brexit and even a global pandemic, London appears resilient in remaining one of the most secure investments the country has to offer.

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