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Crossrail locations to outperform London

KUALA LUMPUR: Properties near Crossrail are expected to outperform those in London by about 4% according to Nicholas Holt, Knight Frank’s Asia-Pacific head of research, during a talk on the next hotspots in London on Wednesday.

“What we’re looking at is a 1% annual outperformance for those properties within walking distance to the Crossrail stations. Over the next four years it will outperform London on a cumulative level by about 4%. And that’s quite a conservative estimate. We think actually it could potentially be more.

“As of now prices are indeed going up for properties around the Crossrail area but I think it can be expected that the next few years will see prices shooting up even further,” said Holt.

According to Holt, there is a housing shortage in London and that demand for housing in the city is currently very high with about 50,000 units a year. Crossrail which is expected to be completed in 2018 is a 118-km line that is set to cut down travel time for commuters by about half the current time. The Crossrail stations will be in areas such as Bond Street, Farringdon, West Ealing, Stratford, Illford and Romford, to name a few.

Holt also highlighted the East London boroughs with areas such as Newham, Tower Hamlets and Greenwich as being the next hotspots to look out for.

“As of May 2014, the year-on-year growth recorded by Newham was 13.3%, Tower Hamlets 18.4% and Greenwich 13.4% respectively,” he said.

Holt said that with this shift it is expected to see more regeneration, new developments and impact from Crossrail as well as strong demand in the rental market. “Rental yields in East London are about 4%, which are actually not too bad if you compare them to places like Hong Kong and Singapore,” said Holt.

Knight Frank also highlighted the Royal Wharf development by Singapore-based developer Oxley Holdings Ltd and private property developer Ballymore. Royal Wharf is a new waterfront village in London that is set to be the new residential heart of the Royal Docks.

The 40-acre (16.2ha) development will feature 3,385 homes, riverside walkway, new streets, connecting park and squares, and riverside restaurants to cater for a population that is estimated to reach 10,000 upon completion.


This article first appeared in The Edge Financial Daily, on July 25, 2014.

 

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