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News: South East will blaze a trail in 2008

Thu, 10 Jan 08

London and the South East are expected to be the best performing property markets in 2008, with nearly 70% of investors identifying the regions as this year’s property hotspots, according to a survey conducted by The Homebuyer and Property Investor Show (7-9 March, ExCeL, London)...

The South East was the most popular region to move to over the last decade** and is continuing to experience a shortage of stock, causing the vast majority of investors to believe the area will see the best house price increases of 2008. Many will be looking to purchase in the South East and London and the growth in buy-to-let interest in these regions will help to buoy the UK property market.

Despite commentary about the oversupply of new build flats in the UK’s major cities, the survey also reveals that just over 40% of investors polled still consider flats or apartments to provide the most profitable buy-to-let investment. The London market has remained stronger than other cities and demand for flats in the capital will contribute to a boost in the market.

Supply and demand fuelling growth

Supply and demand is given as the main reason that the housing markets of the South East and the capital will continue to do well in 2008. The belief is also fuelled by the improved transport links, wealth, foreign buyers and regeneration across the area.

In particular, the Thames Gateway is expected to do well due to extensive regeneration and the recent go-ahead for the East London rail line and Crossrail. Kent as a whole is also one of the top choices due to the new international rail terminus at Ebbsfleet, making the county more accessible.

Merseyside was ranked as the second most promising area for property price rises due to being named the European Capital of Culture for 2008. However, the area still came far below London and the South East, with only 10% of investors confident in its performance.

Northern cities suffering

Andy Smith, Managing Director of 1st Property Investment Ltd, who will be exhibiting at The Homebuyer and Property Investor Show, comments: “Historically, London and the South East have usually been the top UK property performers, often regardless of the overall national house price trend. It is encouraging that investors still recognise the significant potential for capital growth even in a more nationally subdued market.

”Strong demand from homebuyers and renters is still there; this is particularly true within regeneration areas where new infrastructure projects are taking place. Such areas will continue to outperform the rest of the market during 2008.

“Despite the hype about the current state of the property market it is interesting to note that many areas of London continue to buck the trend.  However, some Northern city centres are continuing to suffer from an over supply of new build flats and investors must make sure they do their research before buying. There is still good money to be made in buying off plan in London and the South East.”

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