England’s Prime Property Hotspots

December 2018 Investec Private Banking - Prime property

CONTENTS

3 Foreword

4 New-build: ready for prime time?

6 Seeking prime: follow the cranes

8 Prime hotspots: now and next

10 Mortgages: what would Beyoncé do?

12 Amenities: Defining Prime New prime: the local halo Prime property means different things to different people and in different corners of the UK. Our 14 Going green: a property sale as ‘prime’ if it exceedsquantitative £1million. research We’ve defines also Why rural is all the rage relied on our survey data, which asked respondents what qualities would make a property prime to inform our research.

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FOREWORD Welcome to our prime property outlook

Where’s the next prime property hotspot? Where’s around Brexit, tax changes and more – have largely the smart money moving, in and across been priced into the market at this point. England? And how are attitudes changing among today’s buyers? Whether you’re looking for new-build opportunities, want to spot the drivers of the property market At Investec, we wanted to answer these questions. or just want to scope out the next hotspot, We surveyed 500 high-net-worth individuals the insights in this report should give you firm (HNWIs) and combined the findings with Land foundations for making that all-important property Registry data to understand the trends reshaping decision. the sector. We wanted to know what today’s buyers think about prime property, the trends RESEARCH SNAPSHOT driving the market and – given the importance of Our report is built on feedback from 500 HNWIs, ‘location, location, location’ – where the hotspots data from independent sources and insights from are now… and in the future. our property team. Here’s what we’ve found: • New-build is starting to redefine prime A standout from our research is how important property. Fresh developments are creating new prime new-builds have become. This is partly prime locations in London, in particular (see p4). driven by up-scale developments across the • Infrastructure is crucial to this trend. Great country. But we’re also seeing a change in the transport, communications and civic amenities are features that buyers are looking for. Larger living key factors that make a property ‘prime’ (see p12). spaces, energy efficiency and faster broadband are • Provincial cities such as Cambridge have all helping the case for prime new-build. benefited from new transport links and the presence of growth industries. This trend is also London remains a special place for buyers. It’s boosting parts of the North and Midlands (see p5). still at the centre of the financial world and there • We’re seeing greater regeneration in outer remains a big undersupply of property throughout London areas with available land, such as the capital. Downside risks to prime property – a Waltham Forest, Newham and Havering (see p7). softer market over the past two years, uncertainty • Gentrification of inner London is a big factor, driven by a desire for upmarket property in trendier areas, particularly by younger HNWIs (see p4). • We’re seeing renewed interest in more rural DEFINING PRIME locations as connective infrastructure is upgraded and new ‘garden village’ projects come to market Prime property means different things to different people in different parts of England. Our quantitative (see p14). research defines a sale as ‘prime’ if it exceeds £1 million – a modest sum in London, but more generous elsewhere. Then our survey data refines the qualities that make a property ‘prime’ to inform our insights. Ryan Tholet Head of Investec Private Bank

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NEW-BUILD Ready for prime time?

In sought-after locations, developers are aggressively marketing prime new-builds as both desirable living and top-notch investment. Buying off-plan might be riskier for some – and with the changing profile of international buyers, the market is hard to predict. So what is it about new developments that tell us the trend has stamina?

Until a few years ago ‘prime property hotspots’ NEW-BUILD SUPPLY AND DEMAND referred strictly to postcodes in Kensington & But it’s in these less traditional boroughs that Chelsea, Mayfair, Belgravia and Knightsbridge. upmarket new-build is having its biggest influence. Now, affordability and demand – coupled The areas where new-build represents more than with high-profile new developments – have half of prime sales include Tower Hamlets (see box) created ‘outer prime’ areas in some previously and Newham – areas with older, higher-density real unfashionable locations. estate, where modern buildings really stand out. True, the big money in London is still highly One reason investors and home-buyers are concentrated in the traditional areas. Westminster looking outside the more well-heeled areas is that and Kensington & Chelsea together saw £8.2 many prime new-builds in the traditional hot-spots billion in prime sales last year – the other 31 are struggling to sell – and have been for some boroughs combined sat at £13.4 billion. time as the Brexit uncertainties mean international Interestingly though, if we only look at locations buyers dry up. That’s pushing many developers in London with more than one hundred £1 million- into aggressive sales – with as many as 40% of plus sales (our lower limit to classify a property as London new-build sales going to ‘bulk buyers’, ‘prime’ in the capital), the biggest sales growth according to a Financial Times investigation. was , where values soared nearly 50%. The volume of new-build luxury apartments going In prime-lite locations the figures get much bigger. up in parts of the capital remains much-discussed. Waltham Forest, for example, saw prime sales There is a chance that in some developments, rocket 165% in 2017; Newham was up 143% and prices will come down as developers look to Havering 61%. These aren’t locations you might crystallise cash. That said, buyers on the sidelines think of as ‘prime’ – and five years ago, high-value looking for developers to slash prices ahead of sales in these locations were negligible. Brexit might be in for a long wait.

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THE HUNT FOR PRIME VALUE Make no mistake: our forecasts suggest the THE REGENERATION GAME prestige postcodes will continue to lead the prime In traditional prime improved last year when property rankings. But the best value new-build locations, developers can Cambridge North station could well be found in those up-and-coming struggle to find green- opened – combined with areas. That’s also why the new-build story is so or brown-field sites to its tech industry and latent build properties with the demand from senior staff interesting outside London, where emerging prime features and contemporary members at the university hot-spots combine with more readily available land designs many HNWI has kept the property homeowners want. But market buoyant. and evolving infrastructure to offer real value. when new transport links, Smaller luxury builds In Cambridge for example (see box), high regeneration schemes, are springing up around demand and low supply, combined with a fast- changing demographics Addenbrookes Road, or business opportunities meeting growing demand growing high-tech workforce, are transforming boost the appeal of an as facilities such as prime property offerings. area, luxury new-build can Cambridge Science Park flourish. Here are three draw in more high-tech North of London, developers are getting creative examples of that trend: employers. Plans are also to accommodate Green Belt restrictions. In South afoot for five new garden Bucks, for example, new-builds made up 20% of TOWER HAMLETS towns between Cambridge This diverse borough and Oxford supported by prime property sales, rising to 41% in Broxbourne, stretches from the Tower new rail and road links. Hertfordshire, as buyers eye its 2 of London to Canning Town, and the Stratford terminus due to open in 2033. border to . Greater prime sales were up 22% So it’s no stranger to in 2017, to nearly £230 million, driven in part upmarket property sales: 258 prime deals totalled by the Northern Powerhouse initiative. In that £344 million in 2017; and city, many developments – like those around St 60% of prime sales were new-builds last year. TYNE & WEAR John’s Deansgate and Salford Quays – are already Look outside Docklands Ranked by The Sunday designated ‘prime’. for really attractive new- Times as one of the best Overall, new-build in 2017 represented £5 builds. There are big places to live in the UK, plans for Brick Lane and Tynemouth boosted the billion-worth of prime sales in England and Wales – Petticoat Lane, a £100 area’s prime market by 16% of the total market. But these developments million redevelopment of 10% last year, 20% of the Old Royal London which was new-builds. delivered a third of the year-on-year growth in the Hospital by 2021 and a High-end residential prime market – an extra £602 million. £350 million scheme at developments in Tyne & Our research shows that outside the South East, Ailsa Wharf. The whole Wear come to market at Poplar Riverside area is exceptional value. Bespoke HNWIs see Bath, Cambridge, Oxford, Manchester ripe for regeneration. projects in village locations and Cheltenham as property hot spots – and around Newcastle, Gateshead and Whitley prime new-build opportunities in these cities Bay will typically deliver remain highly sought after. When it comes to large homes below the the properties themselves, size, unique features £500,000 mark, despite including the high specs and great transport links are considered the key and generous living space attributes for ‘prime’. demanded by HNWIs. CAMBRIDGE In other words, the old rules still apply. Location Our research shows 24% is key, as ever. But today, marrying that to larger of prime property sales in spaces – designed with an eye to contemporary 2017 were new-builds – that’s around 35 properties living habits, with the energy-efficient attributes of in Cambridge, worth new-build that are springing up in go-getter cities £45 million. The city’s strong transport links – (more on that on p6) – is starting to look like a smart move.

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SEEKING PRIME Follow the cranes

Prime property remains a solid long-term investment opportunity across the UK. But prospects are best in areas slated for first-class residential, commercial and transport developments.

Economist John Maynard Keynes may have Izard, business development manager at Investec. had a point when he said that “the long run is Although this has partly been tempered by the a misleading guide to current affairs”. When it currency play – sterling’s weakness has boosted comes to investing in property, however, it’s affordability for many foreign buyers – there’s no long-run performance that really matters. doubt that “stamp duty changes have pushed up Take the London market. Our research shows the cost of entering the market and Brexit has hit values in the capital have softened in the past overall sentiment”. couple of years under the combined impact of Brexit-driven uncertainty, over-ambitious asking PRIME TIME DRAMAS prices and tax reform. But if you look at London’s longer-term prospects, “International buyers of prime, especially the perspective changes. Based on our forecast for new-build prime, have been hit,” says Peter 2018, the total value of deals in one of London’s top boroughs, Kensington & Chelsea, is expected to rise by 14%. Neighbouring Hammersmith & Fulham shows a similar rise. These gains look set to be even higher in central areas that have not previously seen investments from the top end Some prime hotspots in of the market, such as parts of Lewisham and London were almost no- Lambeth (where values are expected to go up by 49% and 47% respectively). go zones 15 years ago The total value of £1 million-plus transactions in England and Wales has risen by almost £2 billion since 2016, reaching £32 billion in total. It shows

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that whatever the short-term indicators, property remains a critical asset class for any long-term WHAT MAKES A PROPERTY ‘PRIME’? wealth-building strategy. After all, says Izard, LOCATION The right postcode is usually a better “HNWIs want to ensure their assets are diversified. indicator of quality than price, according to our Even with the disincentives around stamp duty and research. Three-quarters of HNWIs told us a changes to income tax, property remains a key ‘desirable location’ is more important now than 10 years ago. part of their portfolios.” VALUE The vast majority of high-net-worth buyers define prime property as £1 million plus, but regional effects are QUALITY COUNTS huge. £1 million in London is now relatively modest; in That said, buying the right property remains Tyne & Wear or Merseyside, it’s palatial. the key to making the most of your investment. COOL In the research, two-thirds of HNWI According to our research with HNWIs, unique respondents said a trendy location has become features that make a property stand out are hugely more important to making a property ‘prime’ than it was 10 years ago. important. (See box.) But the definition of ‘quality’ has moved with UNIQUE the times, widening from Jacobean staircases, 21% of HNWIs told us having a unique feature that makes the property stand out was the most important factor in Georgian plasterwork and statement fireplaces. making a property ‘prime’ – but the following six qualities For example, says Izard, “connectivity is now of a potential prime property scored equally well. a big factor – having access to fast broadband is increasingly a must-have. Changing working 22% 21% 20% 19 % 18% 17%

patterns and a desire for work-life balance mean Square footage Unique feature Transport links Commuting Garden/outdoorRental demand space for a home office is also high on the list.” This helps to explain the popularity of new- builds, where properties are typically designed for space, modern lifestyles and all the technologies – from wiring to energy saving, and even power generation – that HNWIs are coming to expect.

LOCATION EVOLVES driving gentrification. “It’s encouraging new prime Of course ‘location, location, location’ is still the residential to serve incoming talent,” notes Izard. rule. But our research suggests the market is “Cities in the North and Midlands could benefit moving into new locales – especially when it comes from company relocations out of the capital, too.” to ‘upgrade’ properties. And investors looking for Similarly, new transport links that open up long-term capital growth, in particular, need to previously under-served areas have a massive keep abreast of planned infrastructure and civic effect on local property values, both in and outside developments, as well as looking at the postcode. London. The Northern Line extension to Battersea, “We’re seeing the emergence of prime hotspots the upcoming Elizabeth Line linking Reading in the in London boroughs that 15 years ago were almost west to Abbey Wood and Shenfield in the east; and no-go zones,” says Izard. “Single professionals and the proposed Oxford-to-Cambridge expressway young couples have gentrified areas. They work and East-to-West train routes in the North have all hard and play hard, and there’s a real demand been game-changers for local markets. now for modern properties in areas such as Tower So where the golden rule of property investment Hamlets and Lewisham.” used to be ‘follow the money’ into established Landmark office new-builds such as the Google affluent locations, today’s buyers may prefer to headquarters in King’s Cross, for example, are also ‘follow the cranes’ instead.

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PRIME PROPERTY: NOW AND NEXT

London dominates prime property. But the year-on-year change in prime transaction values (the arrows with percentages) offers insights into where high-net-worth individuals (HNWIs) are seeking out future value – especially from new-build. Hotspots in the centre of the capital and the stockbroker belt don’t show that much growth, partly because they’re already so popular (the height of the spikes shows total prime property sales in 2017). The biggest gains outside London last year were in , , and Cheltenham. National infrastructure projects connecting them with each other, and London, will boost new-build opportunities in these areas. Our analysis of prime deals to the end of 2018 (below) offers other tips on the next generation of growth areas nationally.

2018: THE PRIME MOVERS

Our analysis of Land Registry data shows prime performance during 2018. These boroughs will have seen the ten biggest percentage rises in sales. Three start from a very low base; where we’re seeing a big jump in denser urban areas (such as Lambeth), new build is a significant contributor.

.8% Albeit from a low 63 base, Liverpool’s 53.8% doubling of prime sales in 2017 looks 46.8% more than a blip. 60.9% 227.3% 48.8% 61.9%

48.6% 141.3% Bath developments such as Hope House 67.5% show why new-build and old class make it one to watch.

Lambeth Havering Croydon Newham

Lewisham

Broxbourne Runnymede Cheltenham Tyne & Wear

Waltham Forest Key: Estimated value of prime property sales in the area (2018) % estimated growth in prime transactions (2018)

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THE PRIME HOTSPOTS

Value of prime property sales in the area (2017) We asked 500 HNWIs where their prime property hotspots 1 Position in HNWIs ranking of current prime hotspots are – so not just where prime sales are (the spikes), but where % change in prime sales (2017) prime buyers love to live. We ranked the top ten in London and in the rest of England by ‘hotness’ (excluding London orbital – which is popular, of course, but neither fish nor fowl in this analysis). Many HNWIs are loyal to their current region – 41% of those in the North West see Manchester as a prime hotspot, for example. But plenty of Londoners are looking further afield – and our analysis of their predictions for hotspots ten years hence also puts cities like Manchester and Liverpool high up the list.

1 Bath 1 Kensington & Chelsea 2 Cambridge 2 Westminster 3 Oxford 3 Richmond upon Thames 4 Manchester 4 Kingston upon Thames Sales in Trafford 5 5 alone jumped £29m & Hove Islington in 2017 as sought- 6 Cheltenham 6 Harrow after developments 7 Guildford 7 Greenwich came on stream. 8 Bristol 8 Hammersmith & Fulham 9 Liverpool 9 Camden 10 Poole 10 Southwark

24% of Cambridge’s prime sales were new build as the city 9 4 delivered yet more tech-driven growth. 21.9% 95.6%

6 5.8% 9 5 2 5% % % 8 2 16.0 18.8 7 6 10.2% 1 3.3% 3 11.5 % 78.2% 8 1 0.2% 3 9.1% 10 % 3.5% 8.7 7 3.3% 14.2% 11. 2 % Brighton’s trendiness 5 and London access 4 10 make it the Gen 9.8% 19.7% % X HNWI’s classic 9.1 escape destination.

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MORTGAGES What would Beyoncé do?

Why do wealthy people need a mortgage? Do the maths and there’s a very obvious reason why it’s worth borrowing to buy...

Last year Beyoncé overtook Taylor Swift as the richest woman in music. Together with her husband, rapper Jay-Z, her family wealth is estimated at $1.25 billion. So it might have come as something of a surprise when the Wall Street Journal reported in September that the couple had taken out a $53 million mortgage for the $88 million mansion with a two-acre estate in California that they moved into last year. Their monthly payments are estimated at around $200,000 – the couple have secured a fixed rate of 3.4% until 2022. And, as the WSJ reports, they’re far from the only billionaires with an eight-figure mortgage. According to real estate research firm CoreLogic, which supplied data for the WSJ’s story, almost a quarter of the current

For the perfect home or prime pied-a-terre, a mortgage is ideal

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US mortgages worth between $10 million and $20 aren’t going to come from a million were originated from 2017; and nearly 16% career change into property WHY PRIME? were taken out in 2018. So it’s something of a investment – they will come In our research, we wanted to recent trend. But why? from protecting their financial find out why HNWI would buy a capital and exploiting their own prime property. And the results are revealing. THE READY CASH ARGUMENT knowledge and experience to There are several reasons why wealthier people still make investments that are right take out mortgages. (We’ll leave aside buy-to-let for them. for the moment, which is a slightly different issue.) Take an entrepreneur who’s The most obvious is liquidity. For many buyers, just exited from one start-up wealth isn’t simply stuck in the bank or even and is keen to buy a property, investments in easily saleable assets like unit but also looking for a new trusts, shares or investment funds. Often wealth project. While they could is tied up in a business that simply can’t be sold; purchase a property outright, it’s in deferred bonuses or salary paid in another being able to reinvest in a new • Long-term home 56% currency; or it’s tied up in mechanisms like long business will potentially give • Second home 18% term incentive plans. them a far better return and play • Buy-to-let investment 11% Buy-to-sell investment 4% For people in search of the perfect home or to their personal strengths. • • Holiday home 2% a prime pied-a-terre, a mortgage presents the A mortgage is therefore a tool • Home for family 2% perfect solution. They can leave their wealth to let them focus on what they It’s a reminder of why the quality invested in growing their business, for example, or do best, rather than tie up a of a property is so important: wait for their bonus to mature without sacrificing large portion of their personal the buyers will be living with their decision – literally. And it their living space. wealth in their home. also highlights why mortgage Another reason is control. Selling equity in choice is also a crucial their company to buy a property might mean THE SUPPLY SIDE factor. Only 4% of HNWIs are interested in ‘flipping’ a property surrendering some influence over its future – not Borrowers are also drawn in by – so securing the right long- to mention creating a potential tax event. Where a ‘supply-side’ factors. The most term deal and optimising their decision in the context of their business is paying out a dividend, these business obvious is borrowing rates that own, wider personal financial owners will have a cash flow, but not capital. remain at historic lows. “We still planning is a vital part of the The solution? Take out a mortgage on the prime see plenty of fixed rate deals, so process. property of their choice, safe in the knowledge that there’s less short-term exposure the business remains intact and they can meet the to rate rises,” says Peter Izard, interest payments from its profits. business development manager at Investec Private Banking. THE REINVESTMENT OPPORTUNITY “The risk is that interest rates might spike, but With the exception of professional developers, that is looking much less likely than a slow steady many HNWI property buyers will already have an climb – especially when you hear the Bank of established income that’s independent of their England’s caution about the situation post-Brexit.” investments in the property market. That could be More generally, a cornerstone of private banking a CEO earning a substantial salary and bonuses; it is precisely the kind of personalised and flexible could be a partner in a private equity fund whose products that allow high-net-worth clients to get personal wealth is tied up in the business; or it into the prime property of their dreams – without could be a young entrepreneur whose wealth is in raiding their portfolio or limiting their ability to invest as-yet uncrystallised intellectual property. in new areas. For anyone in this position, the greatest returns

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AMENITIES New prime: a local halo

Prestigious developments that attract buyers can put up-and-coming areas on the map and lift local property prices.

No one doubts the importance of location when So it’s hardly surprising that new-builds it comes to property. But what qualities make a increasingly tend to have iconic designs that place attractive and why? We know that well-heeled redefine the local skyline – just think of Renzo residents know what they want when it comes Piano’s in Southwark, or Canary Wharf’s to amenities and new-build, particularly if it’s a upcoming One Park Drive, a circular tower by greenfield development where services are still Swiss architects Herzog & De Meuron. being established. Distinctive architecture often comes with And that’s why smart buyers pay attention to beautiful landscaping, think Jellicoe Gardens or infrastructure. Improvements to transport, retail Handyside Gardens in King’s Cross; striking art and civic amenities can change the fortune of a installations, such as in North borough, drawing investors to previously Greenwich; or both, like at St Alban’s One Gabriel unfashionable areas. Square, which features three works by sculptor David Harber. POLISHING THE HALO However, new-builds add more than just “New-build often has a halo effect,” says aesthetic value to their neighbourhood. Many Peter Izard, business development manager at developers now package their residential units with Investec. “Beautiful, high-spec developments are shops, restaurants and services. It’s easy to see inherently attractive, and usually come alongside why. Our research reveals that over three-quarters infrastructure improvements and employment of HNWI buyers see a ‘desirable location’ as more opportunities that draw ever more people in.” important than it was 10 years ago – and a vibrant Our research shows buyers at the upper end of atmosphere, great entertainment and easy access the market prize good transport links. But they also to good facilities are all key ingredients that make value size, unique features and outdoor spaces. an area highly sought after.

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Wembley Park’s 85-acre regeneration, for at Meranti House, in Tower Hamlets’ Whitechapel example, encompasses culture and entertainment area, accounted for 15% of the borough’s £1 venues such as Second Floor Studios – affordable million-plus property sales last year. Like many spaces for artists – the Troubadour Theatre and London regeneration projects, these new-builds Boxpark, a massive event and street-food hall. offer great access to the centre of London, local history and culture – and the influx of residents FACILITIES, FACILITIES, FACILITIES then support new retail and amenity providers. It’s not just transport, shops and greenery. Civic Some emerging locations are not on the radar of facilities such as schools are accompanying these prime property buyers yet. Only 4% of our survey new developments. typifies this focus respondents see Tower Hamlets as prime in the on the wider amenities – allowing residents the making, for example, while Waltham Forest garners facilities they need on their doorstep. The new a meagre 2% – even though our research identifies residential development by the Canary Wharf both as future property hotspots. Group centres on One Park Drive, and will have But the new developments in these boroughs a new primary school, a GP surgery and 380,000 suggest this perception will change soon. Then square feet of boutiques, restaurants and other look further afield – at the new garden towns being retail space. This is all in addition to the five planned, for example – and it’s clear there are shopping centres and more than 300 shops and plenty of ground-floor opportunities for buyers in places to eat and drink that are already open on locations that offer the profile they’re looking for. the existing Canary Wharf estate. Once residents move in, their presence often drives upgrades to transport, education and amenities, which make an area even more desirable. And if a new school gains an Outstanding rating GENERATION RENT GROWS UP from Ofsted, for instance, the impact on local As Millennials (born between 1981 and 1996) begin to enter property is as large as it is immediate. According to their main property-buying years, they’re putting their own twist a study by the Department for Education last year, on the market and reshaping the very notion of what makes a neighbourhood desirable. But not in ways you might imagine… prices are 8% higher near the best-performing Gen X (born 1965 to 1980) place most value on a location’s primary schools and 6.8% higher near the best ‘cool’ factor. In our HNWI research, 71% of respondents aged secondary schools. But other studies found local between 35 and 54 said buying in a trendy, up-and-coming area has become more important to them in the past 10 years, effects can be even more dramatic, with one study against 67% of those in the Baby Boomer (1946-1964) cohort. showing a 17% boost for house prices in sought- But Millennials seem to place less value on trendiness than the older groups: only 64% say that a trendy location is more after school catchment areas. important for prime status than it was 10 years ago. Our research shows Gen X and older Millennials favouring NEW-BUILD’S VIRTUOUS CIRCLE traditional boroughs like Kensington & Chelsea, Westminster and Richmond – plus Islington, Camden and Kingston. Younger Major regeneration projects are the ultimate Millennials (18 to 34) like Barking & Dagenham and Barnet in the expression of this virtuous circle. They often capital – with Liverpool and Manchester as the regional stars. When we asked them to look 10 years ahead, the shift was feature a combination of high-profile new-builds, even more radical. The younger cohort are watching Harrow, restaurants, shops and prestigious office space; Bromley and Hillingdon. Wedged between Wembley and Slough, brand new transport and street facilities; new the latter gets the vote of 11% of the younger Millennials and 8% of Gen X and older Millennials – and zero Baby Boomers. civic amenities; and tend to be in neglected but Northern cities (Liverpool, Manchester and Leeds) trump old- attractive locations. time favourites Bath, Cambridge and Oxford for Millennials. But both younger and older buyers can agree on one thing: Our research shows that in the London borough the top hotspot in the future will remain Kensington & Chelsea. of Tower Hamlets, new-builds essentially created a prime market where there was none. Just 42 sales

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GOING GREEN Rural is all the rage

Improving transport links, plans for rural broadband and the normalisation of flexible working arrangements is making country life increasingly attractive, even if you haven’t retired. And look out for luxury living in the new garden towns…

The best value new-build could well be found in the up-and-coming areas

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The story of our research into prime property – and financial step – especially as the country continues of HNWI attitudes to what it is and where to find to face a housing shortage. Planning remains a it – is really one of access. The traditional hotspots key consideration. But for limited developments, in London still hold their appeal. But we’re seeing schemes such as permission in principle (PIP) are more interest in homes that can cater to a modern, helping developers secure new starts. remote-working lifestyle without the hassle of city As more regions upgrade their infrastructure, this living – interest stoked by improved transport links, could open up new developments outside existing civic investments, emerging business clusters and metropolitan areas. That means squaring the circle changing perceptions of what ‘prime’ means. Why that the HNWIs we surveyed laid out: access to be in the city so long as you can still access it? amenities and fast transport, but also spacious True, for many HNWIs, the ivy-strewn country residences and large outdoor spaces. pile has always been high on the wish-list. But But it’s not just luxury barn conversions. A major changes to the accessibility of a host of services is development to watch will be the Cambridge- making even the most stubborn city-dweller look at Milton Keynes-Oxford growth corridor. New rail a rural idyll as more than just a weekend bolt-hole. links and an Oxford-Cambridge Expressway will Rural areas likely to be reached by infrastructure support 1 million new homes by 2050 in a string projects – such as the mooted Crossrail extension of garden towns and villages – offering new-build to Ebbsfleet and Kent, HS2, or a raft of smart standards of design and technology with tailor- motorway upgrades – could see heightened made rural living – all in areas that our research interest in rural property. Hotspots are likely to shows are desirable locations for the better-off. be in the Chilterns (above HS2) and deeper into The garden towns push in England is part of the Oxfordshire. government’s ambition to build 300,000 homes When we asked property buyers which rural a year by the mid-2020s; 23 locally-led garden regions appealed right now, 10% picked South communities are already receiving funding support. Bucks and 21% Oxford. But don’t discount the These developments might well be the ideal option North, where fast transport links look set to open for those looking to put some green back in their up value-for-money rural areas. When we asked lives, allied to surroundings and homes built to 21st about future hotspots, 43% picked areas north of century standards of efficiency… and all without the Wash. sacrificing access to amenities, the capital and Equally, while rural broadband remains a sore charming character. point for many country dwellers, investment and technological developments (such as the 5G roll- out, due to start in 2020) should make access much better in the near future. The Government’s Rural Development Programme for England committed an extra £45 million this year to the £30 million existing Rural Broadband Infrastructure Scheme (RBIS) to deliver superfast broadband in poorly-served areas.

FARMS AND GARDENS One driver is sales of agricultural land. The trend in farming is diversification, and freeing up parcels of land for commercial and residential building while retaining mixed-use estates is a logical

15 Contact us We’re here to help. To find out more about the Investec Private Bank, Property finance, get in touch:

Ryan Tholet Head of Investec Private Bank [email protected]

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Disclaimer This whitepaper is for general information purposes only and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions, nor for any loss or damage arising from reliance upon any information herein. It is advisable to contact a professional adviser if you need further advice or assistance as the implications of buying an investment property can vary depending on an individual’s personal investec.co.uk/primeproperty circumstances and may be subject to change in the future.