The latest LendInvest index has given a clear signal that London continues to struggle, amid a downturn in the buy-to-let sector as a whole and the wider property market slowdown in the capital.
It revealed that five of the bottom ten postcodes for buy-to-let in terms of capital gains, rental price growth and transaction volume growth are in the capital, with Watford also in this group. East Central London did worst of all, which might suggest the deflating of a post-Olympics bubble. Kingston-upon-Thames, West London, South-West London and Ilford were the other badly-performing post towns in the capital.
By contrast, no London post towns were in the top ten.
Colchester topped the quarterly report, which also included fellow East of England destinations such as Luton, Ipswich and Norwich, while the south-east was represented by Brighton and Rochester.
The emergence of Luton, listed fourth in the table, is particularly notable, not least because its fortunes contrast with those of Watford, a town with which it enjoys more than just a footballing rivalry.
According to the index, Luton offers yields of 3.97 per cent, capital gains of 8.6 per cent, rental price growth of 3.72 per cent and transaction volume growth of 1.65 per cent.
Linked to Kings Cross via the Thameslink line and possessing an international airport, the town already has many advantages. Moreover, plans are in place to improve connections to the airport through a mile-long light rail system to connect it to Luton Airport Parkway station. It also hosts one the University of Bedfordshire’s campuses, ensuring plenty of demand for student accommodation.
At the same time, Luton may be appreciated as a popular place to live by those keen to get out into the countryside, given its proximity to Dunstable Downs and the Vale of Aylesbury. Due to rising house prices in the London commuter belt town, off plan property for sale in Luton offers investors strong capital growth potential.
For more information about Luton property investments, access Experience Invest’s London commuter belt property guide and discover how you can generate higher than average rental returns and strong capital growth potential from a fully managed, new-build opportunity.