The link between good access to public transport and higher property prices is generally well accepted but Covid-19 has brought lifestyle changes which could well result in buyers rethinking the meaning of a well-connected neighbourhood (see Home buyers put fresh air and family ahead of proximity to the office). 

With this in mind, there are areas of London that are centrally located but hitherto perceived as poorly connected which could now have scope for value growth.

I have blogged before about the rise in the popularity of cycling in the city (see Why buyers will be attracted to new developtments with good cycle facilities). In recent years there has been a steady increase, the number of cyclists on hired bikes in central London up 29 per cent from 2014 to 2019, until the national lockdown meant all movement reduced dramatically. More recently TfL has released data showing that journey numbers in inner London increased by 7 per cent compared with spring 2019 and 22 per cent in outer London.  

Not only are more people cycling but they are spending more time on bikes with the average travel time on a Santander Cycle rising from under 20 minutes in March 2020 to over 35 minutes in May last year.

In tandem we’ve seen the emergence of rentable electric bikes such as Lime and Uber (Jump). These bikes are not tied to fixed locations, offering micromobility to areas that may be less accessible and the ability to ‘cycle’ to work with minimal effort.

E-scooters are currently illegal on all but privately owned land. However, the Government is reportedly starting trials to legalise them later this spring which, if successful, will surely only increase their popularity. East London is already well aware of their potential since Bird launched its rental scooter in the Olympic Park in 2018. This allows users easy access across the park from Westfields to Here East which otherwise would be a 20-minute walk or so.

The prospect of increased personal mobility could lead house hunters to change their criteria for a desirable location if a 20-minute walk to the closest station is perceived as a 5 to 10- minute ride instead.

We’ve analysed areas of London to identify where there may be scope for property values to rise if the perception of connectivity improves.

The top image is a value heat map and highlights areas within 10km of Trafalgar Square. As expected, the areas of high value are concentrated around Hyde Park and along the river, while areas of relatively good value are to the east and south east as shown.  

The map above is a connectivity heat map using PTAL rating to outline how connectivity may differ (PTAL stands for Public Transport Accessibility Level and is a measure of connectivity to the public transport network for locations within London). As you can see, there is a correlation as many areas of lower value also have a lower PTAL rating. Given how central all these locations are, they may increase in popularity due to the rise in micromobility.

We have highlighted three areas which we believe offer the best opportunity for growth, where an increase in connectivity is also met with a significant development pipeline.

Hackney Wick

There has been strong demand in Hackney Wick for a number of years with the blueprint for successful development being set by the Bagel Factory in 2018. This is now being followed by schemes such as Lock 19, Stone Studios and Wickside. The quality of place has been steadily building over the past few years and combining this with increased connectivity to one of London major transport hubs in Stratford suggests there is further growth to be seen.

Poplar

Just down the river from Hackney Wick is Poplar, another area of relatively good value. Berkeley is launching Phase 1 of the Poplar Riverside scheme providing major regeneration in the area and is just one of many sites due to be developed over the next five years along the river Lea. This will create a vibrant residential-led community which together with improved access to the Jubilee stations through micromobility provides a strong argument for growth in the medium to long term.

Old Kent Road

Lastly, and possibly the best example, is Old Kent Road. The value heat map shows a large area of relatively good value following the road to the south east towards Greenwich, yet the closest tube station is Elephant and Castle, a zone 1 location.

Similar to Poplar, there is a large pipeline of development forecast over the next five years, again led by Berkeley Homes. The site is currently around a 30-minute walk from the tube or a 10-minute bus journey, however, it would also only take about 10 minutes on a bike showing how effective it can be as a form of urban mobility.  

With house prices currently significantly lower than those surrounding the station it would appear that there is substantial opportunity for growth here as well.

Further information

Contact Hamish Wilson

Contact Savills Residential Development