Property investors looking for the next hot spot should pay attention. Knight Frank has identified the next up-and-coming part of London, and it's really central.
W2 – specifically Bayswater, Paddington and Queensway - has “arguably the strongest development and regeneration potential of any prime central London residential market,” according to Knight Frank's head of London residential research Tom Bill.
He argues that W2 has been relatively unloved by investors and residents alike, leaving the area north east of Hyde Park with a much lower premium than its southern neighbours such as Notting Hill, Maida Vale and Hyde Park itself.
W2 has even earned itself the informal name “the wrong side of the park”.
He highlights the premium of 155 per cent commanded by properties within 50 metres of the southern edge of Hyde Park compared with those between 50 and 300 metres away; on the northern side of the park the equivalent figure is 38 per cent.
In the 10 years to June 2014, prices in W2 have grown by 27 per cent less than those in other postcodes including W8, SW7 and W1K.
But with new developments, largely spurred by the improved infrastructure that Crossrail will bring, Bill notes the area could be ripe for a rise.
“What this area of W2 lacks in history it more than makes up for in geography,” Bill says.
“With the affluent Maida Vale residential district further north and south-facing views of Hyde Park in the opposite direction, the district has arguably the strongest development potential of any prime central London residential market, meaning that in the 21st century it sits firmly on the right side of the park.”