Developers should look to London’s fringes for the residential development hotspots most likely to outperform the wider market over the next three years, according to Knight Frank.
The agent’s second Hot Spot report cites locations including Acton and Old Oak Common as among the best prospects for value growth by 2018, thanks to major infrastructure projects.
Knight Frank is forecasting that residential values in Acton will rise by 46% by 2018, from £650 per sq ft to £950 per sq ft, thanks to the arrival of Crossrail and the “critical mass” of new homes planned for the area.
At Old Oak Common – where there are plans to create a transport superhub for HS2 and Crossrail – it expects up to 53% growth, provided the government approves the project.
Knight Frank joint head of residential development Ian Marris said that savvy developers were already looking to zones two, three and four as the zone one market cools off.
However, he said some core markets including Mayfair and Victoria still offered excellent prospects for growth.
“While the trend for London as a whole is positive, the more astute will analyse opportunity on a micro-geographical level and assess their schemes against local characteristics,” he said.
“Margin will be driven by detail, not generic overviews and for those who continue to explore opportunity we believe London has some exciting and profitable years ahead.”
Top spots
• Acton
• Old Oak Common
• Earls Court
• Bayswater
• Nine Elms
• Victoria
• Mayfair
• King’s Cross
• Euston
• City Fringe
Source: Knight Frank
