London’s best ‘recession-resistant’ areas to buy a home

A dramatic drop in prices could leave homeowners in a negative net position, where the property is worth less than the mortgage taken out, while falling property prices could make mortgages harder and more expensive to obtain.

Most pundits still think a housing price slump is an outside chance, but the current economic uncertainty shows no signs of ending anytime soon.

A recent Deloitte survey found that nearly two-thirds of finance executives expect a recession next year.

As further interest rate hikes are expected, fintech firm Proportunity has conducted research into ‘recession-resistant’ areas of the UK to help buyers hedge against property market volatility.

How to Spot a “Recession-Proof” Neighborhood

By analyzing 331 local authorities and looking at areas that have done well in previous recessions, the company has identified a set of characteristics to look for when buying property.

These include affluent areas with low housing supply, a higher proportion of Millennials (a marker of higher economic activity), a greater number of older properties and larger than average properties.

The top three areas of the UK in ‘recession’ are all in London, while outside the capital South Gloucestershire is another area where prices are unlikely to fall. Other strong areas include Luton, Bracknell Forest in Berkshire and Broxbourne in Hertfordshire.

Where to buy in London

The riverside in Kingston upon Thames

/ Daniel Lynch

At the top of the ranking is Kingston upon Thames in south-west London, where the average terraced property sells for £765,686 according to Rightmove.

The old market town’s green spaces and good schools mean it’s likely to still be a popular choice for families.

According to Peter Knowles, head of the Hamptons’ Kingston office, the data shows the region is generally immune to market downturns.

Knowles said a common reason families have to move is if there isn’t a good secondary school once a child has finished primary school, but Kingston has great options for both. age groups, which means less “churn” and therefore less stock available.

He added: “In terms of other recession proof areas, Surbiton is also a great area for the same reasons and with more people now being asked to come back to the office, maybe 3 or 4 days a week. , the 17 minute train times to London Waterloo is a huge bonus.

Crouch End in Haringey, another ‘recession-proof neighborhood’

/ Adrian Lourie

Haringey in North London is one of the most desirable locations in London, where the average terraced property sells for an average of £825,136 and the average flat for £462,224 according to Rightmove.

Its resilient market is due to its many parks and green spaces, its proximity to central London and upscale neighborhoods such as Muswell Hill, Crouch End and Highgate.

According to Proportunity, the third largest London location for ‘recession-proof’ homes is Harrow in West London. Like Kingston, the area has good schools and is well connected to the city.

Harrow

/ Daniel Lynch

In addition to these areas, London’s main market is its own microclimate and remains immune to economic fluctuations according to Alex Woodleigh Smith, managing director of AWS Prime.

“The main market is likely to be more resilient than other areas due to the fact that many buyers are cash buyers and therefore less affected by interest rates and stock market fluctuations.

“Furthermore, many prime buyers in London are international buyers, so again they are not as susceptible to domestic inflationary factors and have diversified interests around the world.”

Woodleigh Smith said the iconic properties in London’s Garden Square were a good example of ‘bulletproof’ investments because of their historic and special architectural interest.

Vadim Toader, CEO and Co-Founder of Proportunity comments: “Buying a home is an exciting and nerve-wracking time. Add to that rising prices and economic uncertainty and the decision to buy or not to buy becomes more complicated than ever.

“Knowing the features that make homes more likely to hold their value and the key areas of resilience is a simple way to protect your purchase. Whether it’s a recession, a pandemic, or just plain uncertainty, ticking the boxes of what’s likely to weather the economic storm adds an extra layer of security to your new home.

About Mary Moser

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