Is Chatham proving to be a future "hot spot" asks Sarah Walker from Square Foot Magazine?

 

Taking into account the normal premium that brand new apartments achieve on their initial sale; property investors have definitely bought into a future "hot spot" ahead of the market in Chatham. Also, a typical investment of £30,000 per apartment over the next 10 to 15 years, has the potential to deliver a tenfold capital growth.  

In early 2005, 52 separate investors and staff bought off plan apartments in two different developments in Chatham, Kent. These were seen as long term (10 to 15 years+) investments. However, 20 months later on there is a feel for whether this is looking like an "above average capital growth" investment.


The following table shows apartment prices in Chatham Maritime, Kent at typical Cost per Square Foot (£/SF) for comparable off plan and new apartments since 2005:

£/SF paid by Incito February 2005*| £/SF achieved in November 2007** | £/SF difference Feb'05 - Nov'07
£198 | £323 | +£125

*source: Land Registry & Incito Property Investment client records February 2005
**source: Achieved sales prices in Chatham Maritime November 2007


A review of Chatham


Chatham is not a smart or fashionable area. However, it has a growing population, and is regarded in town planning circles as the "jewel in the Thames Gateway". It is at the beginning of a major, government sponsored, re-generation programme that is going to make it very attractive as a residential and business area over the next few years. "These are just the kind of things that we look for when sourcing future "hot spot" locations before everyone else" says Nick Hopkinson, Director at Incito, who sources off-plan investments for clients.

Is it a good time to invest again now?

The good news for long term investors is that the UK residential market has slowed again following the recent US sub prime mortgage crisis, the subsiquent "credit crunch" and the difficulties at Northern Rock bank. Meanwhile, the market fundamentals of chronic supply shortgage and a booming population remain stronger than ever and will continue to drive up property prices in the key areas of London and the South East over the next decade and beyond. At Incito we are excited that we are currently seeing a short term buyers market that is likely to last only till the New Year when interest rates are forecast to drop. 

End of November is a key sales period for a number of the large developers as they need to achieve year-end sales targets.

"We are seeing some very exciting investment deals at the moment that simply have not been available for the last couple of years," explains Hopkinson. Current "buyers' market" deals available from Incito Propertyare located within high yield rental and capital growth locations such as:

  • Crawley, Sussex
  • Ebbsfleet, Kent (new Eurostar station just opened)
  • Hounslow, London
  • Chelmsford, Essex
  • Ashford, Kent
  • Lewisham, London


Visit Incito's website for more details.