Crossrail effect sees prices rise well before 2018 launch
02 October 2014
National Rail’s Crossrail scheme is already having an effect on property prices, according to online estate agent eMoov, with data released by the firm also showing the likely price increases once the new service is fully operational.
Across all locations of Crossrail 1, the average price has gone up by 61% since 2004, with a further rise of 39% expected by 2020. Tottenham Court Road, which has often been labelled as the epicentre of the project, is the star performer when it comes to the Crossrail effect, with prices now over four times higher than ten years ago.
An average flat in the area, which has been heavily redeveloped as a result of the scheme, could have been acquired for £240,000 back in 2004, but now costs over a million pounds, a huge increase of 439%.
Away from the capital prices have also increased, with Reading so far reporting a modest 11% rise in the price of a flat since the start of 2014. Nonetheless, the prices of larger properties in the area have leapt by 63% for a semi-detached and 40% for a detached house. Reading will be one of the UK’s hottest areas for property over the next few years, eMoov predicts, with the online agent expecting prices in the area to grow by as much as 50% over the next six years. For an average flat in the area, this would mean a rise of close to £90,000 by 2020.
The extension of Crossrail into Essex, meanwhile, has meant some areas of the county have witnessed rises of 50% over the past 10 years. Detached properties in Brentwood, for example, have doubled in value to £800,000. In 2004 the average flat in Brentwood would have set you back £155,000. By 2020 this is predicted to have doubled in price.
To the west, the expansion of Heathrow Airport has all but guaranteed a shake-up of property prices in the local area. Prices are predicted to grow over the next ten years due to the continued investment in local infrastructure. Places such as Maidenhead, Slough, Iver, Burnham and Langley benefit from not being directly under the Heathrow flight path, but they still remain in close proximity to the world’s busiest airport and the Crossrail link. As such, eMoov anticipates that flat prices will rise by up to £150,000 in these towns by 2020.
With regards to the Crossrail 2 proposal, the interest of property investors should be piqued by the potential gamble of buying property now before any decision on the second phase of the plan has been set in stone. eMoov believes savvy investors and first-time buyers should look no further than Dalston Junction, which has benefitted over the last few years from significant prices rises on both sides of the Kingsland Road, in neighbouring Stoke Newington and Hackney. Ten years ago, a flat in Dalston Junction was priced at just under £190,000. This has now skyrocketed to £450,000, an increase of 141%. eMoov predict that, by 2020, a flat in the area will cost over £660,000.
Hackney, on the other hand, has witnessed the biggest growth in prices outside zone 1 since 2004, with prices up by over 220%. In 2004 a flat would have cost you £184,000. By 2020 it will have soared to £600,000+. Hackney has outperformed other local areas which weren’t recipients of the redevelopment, regeneration and greater press coverage provided by the 2012 London Olympics
Seven Sisters, where prices have gone up by 60% in comparison to Hackney, may start to play catch up if it is confirmed within the second phase of Crossrail. Prices, if this happens, will go up considerably, with the average flat set to rise by £100,000 by the time Tottenham Hotspur finish their first season in a new stadium.
Russell Quirk, CEO of online estate agent eMoov, commented: “The London market is currently cooling however there are still pockets of the capital and south east which represent fantastic opportunities for property investment. Crossrail locations can expect significantly elevated increases in prices in the coming years compared to non-Crossrail areas.”