London is the hub of the UK property market and expects a 11.88% average price increase by 2021, the highest in the UK

Predicted Property Hotspots

The capital is one of the most desirable places to live, not just in the UK, but in the world. It is also one of the most expensive with the average property value of more than £500,000.

The largest upwards increase in average house prices is expected to occur in the following four Boroughs:

  1. Richmond upon Thames
  2. Camden
  3. Westminster
  4. Wandsworth

Richmond came in at number one of our list of Boroughs in London expecting to see the largest property price increases. Those living in the area on average earn 45.7% more than the UK average, which means there is widespread affluence. It also has a high employment rate meaning that average household incomes in the area are particularly strong.

However, what hasn’t been accounted for in this economic three to five year analysis, and which could negatively impact house prices in the area, is the Heathrow Airport expansion. A third runway was given the go-ahead by the UK government in late 2016 and it is expected that the planning process will be over by 2020, when building work may start taking place.

As well as Richmond, residents of Westminster and Wandsworth also enjoy better than average earnings. In Westminster the average full time worker earns around 46% more than the national average, and in Wandsworth earnings are 41% higher.

In Camden, pressure on population growth is expected to be a driver of increasing property prices. In the next five years, the local population is expected to grow 7.6%, compared to 5.1% in the rest of London. It is also expected to experience one of the highest levels of short to medium term employment growth in the London region (6.9% growth over the 2015 base level), adding to the number of people likely to want to reside closer to their place of employment.

Investment Snapshot

  • Investors in London own four properties on average, and the average value of these properties is £2,228,664
  • Across all UK respondents, 20% own property/properties in London. Almost two-thirds (62%) of these properties are being used for rental income
  • Over three-quarters (79%) of investors in London are planning to buy new property/ properties in the next three-to-five years
  • They are very confident about their prospects for increases in rental income over the next three to five years – expecting to see an average growth of 10% (compared to the national average of 6.1%)
  • They are optimistic about their investment prospects – investors in London expect the average value of the property / properties they own to increase by 10.4% over the next three to five years (compared to a national average of 8%).

Key findings

The Barclays UK Property Predictor reveals the areas across the UK where house prices and rental incomes are expected to rise. The research uses factors such as rental trends, employment levels and commuter behaviours, as well as a survey of high net worth individuals to understand where and why they plan to buy in the future.

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