The latest report from London real estate agent Fraser & Co. claims that British buy to let investors are beginning to take advantage of low mortgage rates and a burgeoning prime property market in the outskirts of London, with new build schemes attracting the most attention. According to the agent, properties in the area bring in better returns than the property market in the central parts of the city.
The estate agent gave an example of a couple which are putting together a property portfolio as part of their retirement plan and are taking note of the investment potential outside of prime central London. They decided to purchase a two bedroom apartment in the Aqua new build development in Finsbury Park as a buy to let investment. The region is currently going through a 20-year regeneration programme “which makes for a promising long term investment”.
Robert Fraser, managing director of Fraser & Co, claimed that the buy to let market has been dominated by Asian buyers for years but now domestic buyers have started showing interest in taking advantage of the higher return in property investments offered by the outer zones. Fraser explained that areas which have seen redevelopment and have good transportation links to the central parts of the city have “significant growth potential”. Fraser noted that Aqua is currently benefiting from the regeneration which is taking part in Finsbury Park town centre and at Woodberry Down, while Rotherhithe is profiting from regeneration schemes in both Canada Water and London Bridge, which are making Anchor Point “equally attractive”.
The managing director pointed out that asking prices in Southwark and Hackney climbed 5.6 percent and 4.1 percent in February respectively, while Kensington, alongside Chelsea and Camden saw either zero or negative growth. Fraser believes that with the increasing appeal of buy to let mortgages demand from domestic investors is expected to start catching up to their international counterparts which is likely to allow regions in zone two to continue thriving and extend outwards towards zone three.