For many investors the capital has lost its shine, high prices and low yields are deterring would-be buyers who are now looking for alternative nearby options that have good transport connections, such as these Top 5 London commuter towns for investment.
Each year tens of thousands of home movers leave London and the pandemic only pushed these figures higher.
Whilst home working will likely be a large part of many roles moving forward, for at least part of the week the reality is there will be some requirement to be in the office meaning good transport connections are paramount.
Renters leaving London are largely not looking to move too far, shrewd investors are turning their attentions to commuter towns for their next investment for higher growth potential and rental yields.
Below we’re revealing what we believe to be the top 5 London commuter towns every investor should be considering…
1. Brentwood, Essex
Train travel time to London: Around 40 minutes
Brentwood is an established commuter belt town in Essex that is known to be a popular place to live in the county, not least for its excellent transport connections.
As well as being in Zone 9 and offering direct transport connections to London Liverpool Street, Brentwood is also just a 40-minute drive from Stansted, London City and Southend Airport.
The Elizabeth Line (Crossrail) will stop at Shenfield Station in Brentwood, when the route opens it will be served by 12 trains per hour and the journey will take just 45 minutes to central London.
Brentwood is one of a collection of commuter towns in Essex that are particularly sought after, nearby Chigwell, Ingatestone and Loughton are also desirable places to live, supporting the potential for price growth in the locality.
Over the past 5 years, property prices in Brentwood have risen by 17.3%, according to Zoopla and the outlook for Essex property prices is strong with predictions for the South East region the latest Savills forecast expecting prices in the region to rise by a further 17% by 2025.
2. Watford, Hertfordshire
Train travel time to London: Around 20 minutes
Watford in Hertfordshire boasts excellent transport connections with the capital, few commuter towns offer such a fast route, with the fastest route taking just 20 minutes into London Euston.
The town’s connections by road are also great with the M1 and M25 motorways nearby.
There’s a lot in the pipeline for Watford with regeneration plans in motion or in the planning stages. Collectively the major regeneration and infrastructure schemes represent a joint public and private sector investment of over £1.5billion in the coming decade.
Historically Watford is on a positive trajectory with strong and steady price growth which is indicative of the outlook; over the past 5 years, property prices have risen by 13.2%. Average buy-to-let property yields in Watford are strong, especially when compared to those in London.
3. Milton Keynes, Buckinghamshire
Train travel time to London: Around 35 minutes
Milton Keynes is a place investors should have on their radars, with a population of over 230,000 that is reported to have grown by 15% over the past 15 years, the demand for housing is strong. Some reports have even suggested that Milton Keynes population could double over the next 30 years.
Location is an incredibly important factor and whilst its train and road connections to London are excellent, Milton Keynes is also very well connected to a number of important business hubs.
The local economy is largely based on logistics and services meaning its connectivity to so many other centres strengthens its prospects. Birmingham, Oxford, Cambridge and Leicester are all as easy to reach as London from Milton Keynes.
Where many areas have seen a slight dip or plateau in price growth over the past 12 months during the pandemic, Milton Keynes property prices have continued to grow, by almost 4%. Over the past 5 years, prices in Milton Keynes have grown by just under 15%.
4. Bracknell, Berkshire
Train travel time to London: Around 1 hour
Bracknell is located at the heart of the UK’s largest tech hub with companies such as Dell, HP, 3M and Honda all having large bases here. The local economy strong and continues to attract young professionals, whilst being an excellent commuter town for London, Bracknell is also a business centre in its own right.
The town centre has already seen extensive regeneration and is vastly improved with plans for continued development. Through several phases of development totalling over £770 million worth of investment, set to be completed in 2032, the outlook for Bracknell is exciting.
With an impressive local economy and the population continuing to grow the indications for both property prices and rental yields in Bracknell are positive.
5. Luton, Bedfordshire
Train travel time to London: Around 25 minutes
Luton in Bedfordshire is located just 30 miles north of London and is a commuter town that buy-to-let investors should be considering.
Luton’s excellent transport connections include fast links to London by train, easy access to the motorway network and of course Luton Airport is on the doorstep.
The University of Bedfordshire is located in Luton and has around 15,000 students in attendance per annum, many of whom choose to live in Luton once they’re graduated.
With low entry prices and continued strong price growth, Zoopla report around 17% price growth over the past 5 years, Luton has strong prospects for capital appreciation and increasing rental yields over the coming years.
Investing in a London commuter town
The dynamics of locations that are ripe for investment, especially London commuter towns can be changeable based on announcements of new projects, continued regeneration, improvements to infrastructure and shifts in economic and population trends.
Price growth and rental yields, the existing figures and the forecasts are also closely examined to determine the top buy-to-let investment hotspots.
The team at Thirlmere Deacon are also watching for the best places to invest, and for developments that are the right quality to appeal to the desired tenants.
Get in touch to learn about the investment locations you should be considering.