Purchasing property in London is expensive at the best of times. However, should your dream home happen to be near one of London’s green spaces, things can turn from pricey to eye-watering pretty quickly.
Research from Foxtons reveals that, on average, properties adjacent to London’s parks are priced 53% higher than the market as a whole. Foxton’s figures show that, for a home near Westminster’s Green Park, buyers will pay a 55% premium (or £1.5m) over the average house price of £954,279 within the borough.
Meanwhile, it’s the same story near Battersea Park (50% higher than the rest of Wandsworth) and Kensington Gardens (40% above the average price in Kensington and Chelsea). Why? Is the answer simply that it’s nice to live near a green space? Or is something else at play?
The Obvious Answer
First of all, let’s deal with the obvious. Living near a green space – especially in the most densely populated city in the UK – is more pleasant for most people. Indeed, a study published in 2023 by the US scientific journal Science Advantages found that it could add years to your life.
Then, of course, there’s a host of other benefits from life in a leafy locale. As we’ve already seen it’s likely to boost the value of your property. However, there are also other benefits like ready access to space for exercise and recreation, increased community and social opportunities, and scenic views.
What’s more, London’s premier parks tend to be in London’s premier neighbourhoods. For example, take Regent’s Park, nestled between Marylebone and St Pancras. Or, Hyde Park in Westminister’s heart. These are desirable places to live, with great transport links and access to just about anything a buyer could need. So is it any wonder living there comes at a premium?
Nevertheless, as we’ll explore in the next section, there are some notable exceptions.
The exceptions
The most surprising part of Foxton’s research is that there were exceptions, in some unexpected places. No one thinks of verdant, middle-class Richmond as an undesirable place to purchase property. In fact, one of Richmond’s major selling points is its two glorious parks.
Yet, a property within the four postcodes surrounding Bushy Park in Richmond will cost a homebuyer a whopping 19% less than elsewhere in the borough. Or, in real terms, an average price of £597,543 versus £737,024 for the borough of Richmond.
The same is true of the postcodes surrounding Crystal Palace Park, where you can expect to pay 14% less than the average across the four boroughs it straddles. Again, while Crystal Palace has never been as well to do as Richmond, it’s become one of London’s gentrification hotspots in recent years with prices continually rising since the pandemic.
So you’d expect these exceptions to follow the general rule, with park-side properties selling for significantly more. What’s going on? Although it’s difficult to establish exactly why prices are cheaper in some areas than others, there is something else we need to consider.
Is Something Else at Play?
We need to talk about foreign direct investment (FDI). As FDI falls across Europe, the UK, (particularly London) continues to attract substantial investment from overseas. Indeed greater London became Europe’s highest-performing region for FDI in 2023, up 20% from the previous year.
What does this have to do with housing? Well, while FDI can be many things, one of the most common things for foreign investors to buy is property. And, if we look at where that investment is concentrated, a pattern emerges. The most popular boroughs for overseas property investment are Kensington and Chelsea (53%), Camden (48%), and Westminster (45%) – home to some of London’s most desirable parks. Meanwhile, areas like Richmond and Crystal Palace (Bromley, Greenwich and Croydon) are some way down the list.
Although, correlation is not causation. Central London locations, coupled with high demand in those areas from FDI may be what’s causing the price spikes. After all, if you’re a wealthy foreign investor, you’ll likely put your money where you’re going to see the biggest returns. At the moment, that’s in parkside property in central London boroughs. And, once a few investors have bought these properties, others will do the same creating a positive feedback loop and pushing properties higher.
What Can Homebuyers Learn?
What does all of this mean for regular homebuyers? Most obviously, if you were hoping to purchase property near one of central London’s most famous parks, you’ll need very deep pockets. But this shouldn’t be news to most Londoners.
A more interesting takeaway is that there are relative bargains to be found near green space in outer boroughs. Surprisingly, long well-regarded areas such as Richmond and up-and-comers Crystal Palace still offer good deals. So, if you’re hoping for greenery within London its time to widen your search.
