Prices in the Abbey Wood SE2 postcode have grown by an impressive 76 per cent in the last five years, but the average remains a relatively modest £309,560.
Buyers have been pouring into Abbey Wood in anticipation of next year’s launch of Crossrail — the Elizabeth line — which will cut journey times to central London by almost half an hour.
While the area is not a thing of beauty and boasts few amenities, it has streets of good-value period terraces where a three-bedroom house would cost £375,000 to £425,000. You could get a slightly dated purpose-built two-bedroom flat in Abbey Wood for about £250,000.
The research by Bairstow Eves, using Countrywide data, evaluated average prices in every postcode in London. Then, concentrating on the cheapest 25 per cent of postcodes, it analysed their one-, two-, and five-year price growth to establish the areas where prices are on the strongest upswing.
EAST LONDON'S TOP THREE
Alongside Abbey Wood the top spots in the league table are taken by locations in south-east and east London. In Plaistow (E13), sandwiched between two giant regeneration zones, Stratford and Canning Town, prices have risen by 74 per cent in five years, to an average £327,608. The average price growth among the 25 per cent of cheapest London locations is 56 per cent.
Bellingham and Catford (SE6), an area well-placed to link to Crossrail services via neighbouring Forest Hill, has performed almost as strongly, with prices up 71 per cent in the same period, to an average £380,641.
For buyers on really slim budgets the bargain basement postcodes are Thamesmead, just north of Abbey Wood, where average prices stand at £252,747, up 60 per cent in five years, and Dagenham (RM10) where prices have grown 66 per cent to an average of £270,878. The once-desolate Thamesmead Estate is currently the focus of a £1.5 billion regeneration. Housing association Peabody was granted planning permission for the first phase of its transformation of the area late last year. There are also plans to link it to the London Overground.
Predictably, none of today’s leading areas are in Travel Zones 1, 2 or 3, where nothing qualifies as affordable. More than one in three are perched on the outer fringes of London – Mitcham, Dagenham, Harold Wood, Welling, Sutton, Northolt, West Drayton, and Uxbridge. Their low prices combined with good transport links have been tempting an increasing flow of buyers priced out of more central locations, pushing their prices upward.
Nowhere in fully priced west London makes the good-value grade, but representing north London are Tottenham (N17), where prices have mushroomed 67 per cent to an average £347,486 — and where billions of pounds worth of regeneration money is being spent on new homes and facilities — and its near neighbour Upper Edmonton (N18) where prices stand at £316,045, up 66 per cent.
“The location of London’s cheapest neighbourhoods is a bellwether for change in the capital,” said David Fell, research analyst at Countrywide, who believes that as these regeneration schemes take root further growth is likely.
“Over the last 20 years the most affordable neighbourhoods in London have been pushed steadily outwards and eastwards as swathes of the inner city reinvented themselves. Some of the cheapest corners of the capital in the Nineties turned into the boom towns of the Noughties, changing beyond recognition in the course of two decades.
“It’s likely to be a similar story for some of today’s cheapest neighbourhoods in London. The arrival of Crossrail and the extension of the Overground will soon plug swathes of south and east London into the rest of the capital. The prospect of these new links is already bringing a wave of new development to some of the furthest-flung corners of the city. Within a decade it’s conceivable that the capital’s cheapest neighbourhood could pop up in west London for the first time.”