‘Of course you can never say prices will never fall anywhere,’ points out Dick Ford, Head of the London residential division at Knight Frank. ‘It was the top end that was worst hit in the 1970s, when prices practically halved in two years.’
And naturally he is right. Despite the latest information on the market in London -which has seen prices climb exponentially in recent times – one can never predict absolutely that property prices, even in the capital, will always go up. But then there are some addresses which are the closest thing to a safe bet you can get.
According to Mr Ford, the areas where people want to buy are dictated by a concept of centrality. Central used to be Mayfair, but from this small part of London, the prime property hunting ground has now been extended slightly north and west. Still, it hasn’t graduated too far: ‘If you had to stick a flag into London for the most centrally desirable point, it would probably be Harrods,’ he admits.
Lifestyle is also crucial. People may work in the City but when they’re not at work they want to have everything they need: shops, restaurants and nightlife in general, withing walking distance.
However, the laws of supply and demand helped to push these boundaries further than the aforementioned stonesthrow from Harrods. Areas to the west, most notably South Kensington and Kensington Gardens, and the top right hand corner of Chelsea up towards South Kensington tube station are all very popular with those with bonuses to spend. And of course Eaton square famously attracts the discerning millionaire househunter.
Holland Park also manages to attract an increasingly large number of buyers looking for lovely big townhouses. Prices there have been steadily climbing for years, and this area is unlikely to fall out of fashion, although any further north would be more of a risk in terms of investment, because the infrastructure is just not there.
Indeed, infrastructure is crucial to those who spend any amount of time in their town house, and for this reason Canary Wharf is looking like an increasingly smart place to buy. The nightlife there is very good, and when increased numbers of retail outlets and places to eat and drink marry with the appeal of waterside living it has the effect of drawing more people rather further south and east than they might expect to go.
Of course traditional City areas like Liverpool Street are off the radar for the very fact that the whole area closes down on weekends and later on in the evenings: there are just not the businesses in place to cater for the clientele. Westminster tends to suffer the same fate.
Outside of the golden triangle between Kensington Gardens, Harrods, Belgrave Square and South Kensington, transport comes into play. For example many areas have benefited from a tube line extension, or in the case of the Jubilee Line, instalment. The advent of the Olympics in 2012 will see large areas of east London changing completely, so for a short term investment over the next five years, it might be wise to pay attention to the new stations planned for the capital and consider going further out than previously looked wise.
Of course, in addition to transport links making an address more salubrious, busy roads and airplane flightpaths can kill an area’s appeal. Much of west London’s attractive housing out past Hammersmith falls under the curse of Heathrow flightpaths and this rules it out completely for many buyers. On the other hand though, places like Acton and Chiswick are looking comparatively more value for money now than they were for the very same reason.
Noise is also an issue for riverfront housing, which anyway tends to come in the form of flats. The traffic volumes past the townhouses there are hardly conducive to a quiet night in. The cityscape by the river is constantly changing ?not all of it for the better of course ? and living by the river is what many would choose, if it didn’t tend to be so noisy, and there were more large houses there to come onto the market.
TOP FIVE INVESTMENT SPOTS IN LONDON
1. Knightsbridge, within walking distance of Harrods SW1
2. Eaton Square, SW1, on the sunny side naturally
3. Cheyne Walk SW3
4. Kensington Gardens W2
5. Wilton Crescent, off Belgrave Square SW1