Buying into an up-and-coming area before it really takes off is one of the best ways for first-timers to make headway in the property market. Perhaps the toughest challenge is spotting an emerging district in the first place. The good news is that you don't have to be a property pioneer by gambling on a new frontier or moving to an off-radar location.
London is constantly reinventing itself: it is a collection of property submarkets where local factors — such as an influx of creatives, a la Hoxton — can lift values beyond the area norm. Savvy buyers are in-tune with these factors.
An early task for neighbourhood watchers is to get to grips with big infrastructure projects, particularly transport improvements — new lines and stations — opening up parts of the capital hitherto hidden or overlooked by homebuyers. Over the years, transport upgrades have significantly boosted property prices.
There is no shortage of regeneration hotspots: Stratford, King's Cross, Elephant & Castle, Croydon, Deptford, Royal Docks, Wembley and Nine Elms in Battersea. But some projects are more advanced than others, so the wait for the "regeneration dividend" — a better neighbourhood to live in and higher resale prices — differs.
Do not overlook the regeneration ripple effect. Bordering areas benefit too — cheaper and unfashionable today, but trendy and more expensive tomorrow. Look for places sandwiched between already improving areas. Rotherhithe and Stockwell in south London and Whitechapel in east London are worth looking at.
Hidden pearly gem
Canning Town — once known for brawny dockers and pearly kings and queens — has to get better because it is between the Olympics zone and Canary Wharf. More than £3 billion of investment is earmarked for the area and new housing is beginning to sprout up.
At St Luke's Square, shared ownership apartments with a view of Millennium Dome are priced from £43,875 for a 25 per cent equity stake. Call Genesis on 0800 954 0221.
Regeneration of sprawling council estates is providing opportunities for low-budget buyers. A number of big estates are getting a makeover or are being flattened to make way for stylish new housing with a mix of tenures — rent, shared ownership and private, a departure from the old public sector model. These include Woodbury Down and Queensbridge estates in Hackney and The Packington in Islington.
Construction has started on 4,000 homes at the 276-acre Ferrier Estate in south-east London, near Blackheath. The 1970s estate is being bulldozed.
About 2,475 of the new homes will be privately owned, while about 500 will be shared ownership properties. The remainder will be for affordable rent.
Berkeley Homes, builder of upmarket apartments in the capital, is spearheading the £1 billion project, and has Southern Housing Group as a partner. The first phase of 449 homes, 220 of which are private, will be finished by 2011. Prices will be released nearer to completion but would-be buyers can register now. Email email@example.com or call 0202 8331 7130. Or visit www.southernhousinggroup.co.uk or call 020 7553 6420.
London and Quadrant housing association is redeveloping the Haggerston West and Kingsland Estates in Hackney. These estates are located either side of the Regent's Canal, meaning there will be new waterfront homes, the first available in 2011. To register, visit www.lqgroup.org.uk or call 0844 406 9800. The site is close to the new Haggerston station on the East London line.
At nearby Kingsland Basin, L&Q is building 207 homes, a health centre, cafe, shops and workspace. Two listed warehouses are being converted.
The first affordable homes at King's Cross Central, former railway yards at the back of the station, have been given the green light by Camden Council. The block of 117 apartments on York Way will be ready in 2012. Contact www.onehousinggroup.co.uk. The 67-acre site is being turned into a new business district, with 2,000 homes, 20 new streets and 10 major public spaces.
Stockwell is a slightly unsung location, quite central, on the Northern line, and with a decent stock of period housing. Big developments are rare, which makes The Quadrant, an ex brewery, stand out. There are 271 homes, with prices starting at £185,000 (full market price). Call developer Notting Hill Home Ownership on 020 8357 4444 or email firstname.lastname@example.org.
The same association is selling shared-ownership flats at Ipsus in Wandsworth town centre, next to the old Ram brewery site. From £212,500, or £53,125 for 20 per cent share.
Developers are astute at exploiting a gritty urban scene. By coming up with design ideas and lifestyle extras, they can put image on a level with location because for many buyers the vibe is more important than the address. But developers are prone to hype the location and set high values, meaning future growth is already priced in.
Bold buyers often get rewarded. But the point about regeneration is that it can take a long time — perhaps five years and possibly 10 or more. So you have to be patient.