Outwardly mobile

Where are the pioneers in the London space race buying?

In all parts of London, families are giving up fashionable postcodes for a large house and even larger savings. At the back of their minds, though, there is always the niggle that during the recession prices in these outlying areas fell fastest and hardest. Even though recovery in some pockets of east and south London is still slow, places with a good stock of solid family houses are seeing rapid growth. Yolande Barnes of Savills Research likens the market to a rising tide; when it retreats it will not go back to the same point and new areas become established.

In the Eighties, Battersea was swept into a new price bracket and it is from this area people are now pushing south in search of more space for their money. Ms Barnes believes real pioneers should be looking towards Lewisham and New Cross, with its beautiful squares near Goldsmith's College and, further in, Paddington and Camberwell.

Winkworth, the London estate agents, has noticed an acceleration of the filter effect, which is a common feature of a rising, low volume market. As buyers move into secondary residential areas, prices are pushed up, creating an exodus of purchasers into neighbouring value-for-money locations.

In west London, this trail may start in Kensington via Notting Hill to Shepherd's Bush where pounds 300,000 would buy a good-sized family house; while those priced out of Hammersmith and Chiswick have discovered a few pockets of Acton with large homes at reasonable prices.

In south London, the enormous increase in prices in Battersea, in some cases 30 per cent over the past four months, is pushing buyers out of Wandsworth and Clapham towards Balham, Streatham and Tooting. A pounds 400,000 house in the best roads in Streatham and on Tooting Common would cost pounds 600,000 to pounds 700,000 two miles away.

Yet precisely where you buy is important, says Simon Agace, chairman of Winkworth. The right ingredients must be there: community, architecture, transport and education. "Even if you overbid and buy into next year's appreciation area you are modestly safe but not in a tertiary area. In a boom market the gap narrows between the good and poor areas, in a recession it widens."

De Beauvoir, on the borders of Canonbury and Dalston, has the required architecture to raise it above some of its struggling east London neighbours. Price- sensitive house-hunters in Islington and Highbury are finding their money goes much further. Instead of paying around half a million for a large Victorian house, they are not likely to be stretched beyond pounds 320,000 here.

In the leafier, outlying areas, places such as Dulwich and Muswell Hill, solid and traditional residential spots, are newly fashionable. Some half-a-million pounds is a good starting point for a large family house close to Hampstead, whereas a few miles out in increasingly popular Crouch End, that figure would be reduced to about half.

In the leafy south-east, Blackheath, with its open spaces and genuine villagey feel, is seeing price rises of 3 to 4 per cent a month. The spill- over of buyers has narrowed the gap between the adjoining Lee conservation area and the heart of the village. A house valued at pounds 190,000 last year is now selling at pounds 255,000.

The Greenwich peninsula is an area full of potential, according to Yolande Barnes, who sees Greenwich offering a better quality of environment than the ever-popular Fulham. "You can pay three times more for safety, or ideally start a trend which could change the nature of an area. Good houses need pioneers."

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