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LettingFocus

Unbiased buy to let, property investment and letting coaching, mentoring, advice and seminars for landlords from top selling property author and media commentator.

Property Investment near London and Transport by Letting Focus

I was going through my blogs from two years ago to see how well my predictions have done - and generally I’m pretty happy.
One interesting blog post from that time looked at how house prices might change in the area around Ebbsfleet following the future completion and opening of the new international station there which would connect North West Kent to Brussels and Paris in a couple of hours.
This new line also connects Ebbsfleet with Central London - journey time less than 20 minutes - compared with local station Swanscombe to London which takes about an hour.
When I wrote the blog two years ago, I had just done a little tour around the area.
At that time the station was still being built - but it is now finished and smart new trains now whiz up and down the line at great speeds.
What interested me then and what had bought me down to Kent that day was the fact that this was a really great transport connection which would normally be expected to push house prices up nicely as it brings in demand from people to live in an area (as well as from businesses to set up business there).

New Build v Transport Connection
But what also interested me as a property investing buyer way back then was the huge amount of new build that was coming on stream and I was fascinated to see how this would play out - because lots of new property adding to existing stock can obviously soak up demand and hold prices back.
As an example, think about how the oversupply of lots of identikit new build flats in the years 1997 – 2005 clobbered prices of flats (and rent levels) in many of our inner cities in the period from 2000-2008.
When I wrote the blog two years ago, I felt that the new supply in the local area was of such scale that it was likely to negate most of the huge positive effects on house price growth which would come from the new international station.
So, I decided against buying there.

Back to Ebbsfleet, Swanscombe, Gravesend and Northfleet
Last week I went back.
My partner had insisted we went to the nearby Bluewater Shopping Centre to get a new sofa. “Your tenants would not put up with a broken sofa for 6 months” she said. “And neither will I”
As Hater in Chief of Shopping (and especially of Bluewater) I offered to do the house cleaning for three weeks. But no, she wanted me to see the new sofa.
So, I went and consoled myself with taking the opportunity to see what’s happened to prices of houses in the area near Ebbsfleet.
Well, I have to say the oversupply seems to have won (so far).
Offer prices of the sort of two up two downs I had looked at in Swanscombe and Gravesend were down from about £175K two years ago to less than £150K generally now, a fall that is greater than other areas I know well - in the more central suburban parts of south east London.
It’s not a scientific study I know, but right now there seems that all the new build stock around the area has easily soaked up the boost to house prices from the new station.

The Future for House Prices in North West Kent near Ebbsfleet

Things could yet change.
When the economy improves, new businesses will invest in that area which now has great transport connections. Whether there is enough effect from this to push up house prices very much remains to be seen.
The message is - always look into the effects that future new stock of housing will have on house prices. You can find this out from the local planning dept at the local authority.
Check out also, this article from my Articles page: http://www.lettingfocus.com/pages/myarticles_BuytoLetLandlords%26RentedSectorGrowth.html

The Old Post

Here is a link to that post from two years ago:
http://www.lettingfocus.com/2007/11/should-you-buy-in-area-near-to-new.html

ABOUT LETTINGFOCUS.COM and DAVID LAWRENSON
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