For buy-to-let investors in London, the areas and properties you are looking to invest in will depend greatly on the type of investor you are. Some may choose to buy cheap properties with high buy to let yields, while others might invest in high value property in exclusive neighbourhoods for long-term financial security. London offers a lot of opportunity for both strategies.
Today we show you London's most popular buy to let areas, where rental property is more affordable and renter appeal is rising, looking specifically at areas where improved transport links and regeneration projects are a major driver of buy-to-let investment.
Barking
Offering the lowest average property prices in the whole of Greater London, the London Borough of Barking and Dagenham should be well within the radar of buy-to-let landlords that are searching for affordable properties. With lower than average values, Barking’s properties have a strong average rental yield and it could be possible for landlords to put down a deposit that is a considerable percentage of the property’s value, compared to areas on the other side of the North Circular, such as Stratford.
In areas of Barking close to the Thames, there has been large-scale development that is attracting different types of buyers and tenants. Barking Riverside is one of the largest development projects in the UK and comprises good-quality homes, schools and a new train station set to open in 2021. Here, the housing stock is designed for everyone, from young professionals to the older generation.
Now is the time to buy in Barking while property prices are lower than the London average and there’s still a lot of regeneration projects yet to be finished, which could cause rental price growth for an investment property, making it one of London's most popular buy-to-let hotspots.
Croydon
Croydon’s popularity has rocketed in the last two to three years, with many homeowners and renters looking in this south London transport and retail hub in search of properties that offer more value for their money.
There’s lots happening in Croydon that has greatly improved the area, including Boxpark Croydon and the upcoming Westfield, which has increased interest from buyers and renters. Alongside improved amenities are the extensive transport links, which provide excellent routes for commuters working in central London and the City.
While Croydon is already experiencing a transformation and average rents reflect this, the properties in Croydon still offer great value for money compared to its neighbours, which is why it is also a popular hotspot for buy to let property.
Woolwich
Soon to be connected with the Elizabeth line in 2018, Woolwich has undergone a number of redevelopment projects in recent years. As well as new residential developments, including Berkeley’s Royal Arsenal Riverside – which will comprise over 5,000 new homes, a hotel and shops – the Spray Street area next to Woolwich Arsenal Station and Beresford Square is getting a facelift, which will be a major part of Woolwich’s transformation.
With plenty going on that is changing the face of Woolwich, now is the time to buy if you’re a buy-to-let landlord looking for a good long-term investment opportunity.
Slough
Just outside the M25 to the west of Hayes and Uxbridge, Slough has become a hub of large IT companies due to its close proximity to Heathrow Airport. This has increased employment opportunities in Slough and therefore, the popularity of its property market, after the decline of the manufacturing businesses in the area.
Slough is hotly anticipating the arrival of the Elizabeth line in 2019, which will offer four services an hour through central London into London Liverpool Street in just 39 minutes. Additionally, the proposed Windsor Link Railway will provide journeys to Heathrow from as little as 6 minutes and will further increase Slough’s desirability if the project goes ahead.
While Slough is currently considered to be quite far from central London, like Croydon, it won’t be long before those working in the City and Canary Wharf deem Slough a viable renting option. Buy-to-let landlords should think about investing now before the new transport links start running.
You might also be interested in our 2020 update on the best rental yield London.
