There's a silent change occurring across London that has the potential to have a significant impact on London life and the property market. Given the go-ahead in 2008, Crossrail is one of the largest transport infrastructure projects that many of us will see in a lifetime. Creating new underground links across London from Maidenhead in the west to Shenfield and Abbeywood in the East, the new line will revolutionise the commute to work for many increasing the London's transport capacity by 10%, as well as creating new property hot-spots across London.
Back in 2008, many cynics would have dismissed Crossrail as a project too big for us to handle, which would ultimately fall foul of political or financial issues. However, 5 years on, if you take a walk around London, the landscape is changing. Huge areas around Canary Wharf, Liverpool Street, Moorgate, Farringdon, Tottenham Court Road, Bond Street and Paddington are changing under our noses. This project is all of a sudden becoming real.
Crossrail work at Canary Wharf Station - Courtesy of http://www.bbc.co.uk/news/uk-england-london-20933396
The impact on property prices in the areas affected has also become real. According to Knight Frank, property prices in areas within a 10 minute walk of Crossrail stations have increased by 30% since 2008, and in some areas will increase by up to a further 43% by 2018 when Crossrail opens.
London residential property prices are already forecast to continue growing strongly in the next 5 years, however properties in the vicinity of Crossrail stations are likely to see increased growth. This is due to the reduced commuting times but also the improving infrastructure in the surrounding areas. Some of the new stations will be completed prior to 2016 and Crossrail is developing circa 3 million sq ft of office, retail and residential space across London according to Knight Frank. New residents, businesses and visitors will be coming into areas previously blighted by a lack of regeneration, creating positive investment credentials.
Recently we have been working with clients to identify investment opportunities in areas of London, directly on to the Crossrail network or linked to it via the London overground or underground network. Areas such as Whitechapel, Farringdon and Canary Wharf are areas where we believe there will be further significant growth in the next 5 years as rental demand increases and more households look to buy in these areas. A report for Crossrail prepared by GVA, forecasts that there would be £5.5bn of added value to the property market between 2012 and 2021 as a result of Crossrail. The matrix below highlights some of the areas that are likely to be most impacted by value change.
Source: GVA - Crossrail Property Impact Study - October 2012
For more information on Crossrail go to www.crossrail.co.uk. You can read Knight Frank's May 2013 report here and GVA's Crossrail Property Impact Study here. If you'd like to chat to us about our work for property investors, please do get in touch.