Buy now to take advantage of the Olympic dream
NEW data released by Lloyds TSB and the Land Registry this week revealed that since London won its bid to host the 2012 Olympic games, property prices in east London have climbed an average of 26 per cent. This compares to a 22 per cent rise across London with houses in the top-performing district, Homerton, jumping by nearly 70 per cent in value.
With the two-year countdown to the games kicking off this week, buyers looking to get on the housing ladder, upgrade their home or just make some extra money on the side would be wise to look east for deals.
Of course, not all of the East End’s above-average price rises are due to the games. But the infrastructure development taking place in the area has jumpstarted the market. The Westfield shopping centre is due to open in Stratford next summer and in the span of a few years, East London has seen an extension of the East London line, an expansion of the over-ground network and, for the north-eastern boroughs, the connection of a high-speed rail link to King’s Cross. There is more to come with the opening of new cycle superhighways, improvements to London City airport, a Jubilee and Victoria line upgrade and even the opening of the east London cable car, which will shuttle people across the river from the Royal Docks to Greenwich.
Developers have been trying to jump on this bandwagon for years, but not all of them will make it, says Bernadette Cunningham of Thornsett Homes: “With a two-year window it’s gotten very tight for construction delivery before the Olympics. If developers aren’t ready to start digging they’re not going to make that deadline.” That means that buyers could benefit from constricted supply before the games.
Moreover, as the map on the right shows, Stratford, which contains the Olympic village, has yet to see significant price rises in contrast to the surrounding districts. This could be because some of the planned infrastructure improvements have only just reached Stratford station, with a lot of the surrounding area still little more than a building site. Now, however, Cunningham says a buzz is building about the area: “If you go to Stratford station now, it’s a beautiful big, glass construction. The aim is to integrate the canals and the industrial history with the modern. You’re asking people to buy into that vision.”
Aside from price rises, those whose properties have good connections to Olympic facilities stand to rake in rental revenues at up to a triple their normal rates. Tim Boughton of online rentals service HomeAway Holiday-Rentals says: “We’re already seeing an unusual number of enquiries into 2012, with Greenwich top of the list.” And some savvy owners are already planning to take advantage of this demand. Deola Laniyan works at an advertising agency and intends to stay at a friend’s while she rents out her property for the games: “It’s the perfect chance to take advantage of the location, to pay off some debt and use the money towards my mortgage,” she says. River Habitat’s Julian Jarvis also says that holiday rental demand is already rising for the summer of 2012.
Some owners are even contemplating renting out their place for the whole year in the hopes of catching demand from those who have to spend the year preparing for the games (tending the grass or overseeing building works, for example).
All of which means that for London buyers trying to capture returns beyond the vagaries of the housing market, east London should deliver good value and solid returns.
WEST HAM VICTORIAN TOWNHOUSE
Price: £374,995
This authentic Victorian house features hard-wood floors in its spacious sitting room as well as three bedrooms and a fully-fitted modern kitchen with dark granite countertops. It also offers a secluded rear garden, a jacuzzi in one of the bathrooms and beautiful views onto the open spaces of West Ham Park. Contact: 020 8534 7788, www.keatons.com.
LETT ROAD
Price: £235,000
This brand new Stratford apartment block offers residents stunning views over the Olympic park from its roof terrace.
With five units already sold, the block could sell out fast. Contact:?020 7718 5220, www.thornsett-group.com.