eMoov have now mapped property prices based on the average house price near major UK train stations.
The map paints a very interesting picture of what the property market looks like for property developers and where their investments will generate the biggest yields.
London’s major stations have been grouped into one giant rail terminal. The average house price pushes above £1million. This looks great for investment, but it always offers a high level of risk. For this reason, we see property developers focusing more on commuter options rather than going straight for the central hub.
Property prices in commuter hotspots
As property development finance lenders from the south east of England, we will focus on this area of the country.
If we look at property prices closer to home, we notice that within our own town in Sussex property prices average £374k.
Focussing on the same train line, we can see that East Grinstead, another Sussex commuter town, boasts house prices of £411k. This is where the map starts to get interesting. The price of land between the two towns is very similar, but the potential return is over £30k higher in East Grinstead.
Property development finance popularity
Over the past 3 years we have provided property development finance to developers within Hampshire, mainly Southampton. If we use the map, we can see why Southampton proves such a great place for property developers.
Southampton provides a great train line into central London. Stations along the rail line boast some large figures for average property prices, this includes; Wimbledon, £736k; Winchester, £474k and Woking, £450k. Compare this to Southampton and property prices average a much more manageable £211k.
Some would be put off by the lower prices, but it actually creates a much better prospect for the developers within the current market. Houses for your average family are in demand much more than for any other demographic of house buyer.
You may be able to borrow more than you think for your development allowing you to choose the best area to build.
Developing the right property
With Brexit in full swing and some uncertainty surrounding the property market. Security can be found by aiming at the lower end of the housing ladder with the strong possibility of increasing the profit margins from the outset, rather than risking it on a central London development.
Brexit has halted construction of much needed houses in areas where wealth outweighs the uncertainty to the market. From our understanding, keen house buyers are still flocking to estate agents to get on the ladder. Demand is unlikely to dwindle for those looking to enter the market.