Spotting an up-and-coming area is the holy grail for homeowner’s and property investor’s – and for good reason.
Buying in an up-and-coming area is a great way of making money on your property, and getting on the housing ladder if you can’t afford to buy in better established neighbourhoods.
But how do you find a town, village, or city where prices are about to start rising?
The short answer is it’s not easy. The term “up and coming” is frequently overused when it comes to towns and areas in a city. Many areas have, or have been, tagged with this label – especially trend pockets of London without ever delivering on the the hype. Although there are no cast iron guarantees that an area will improve (or that house prices in that area will rise), there are some tell-tale signs of an area that is on the up.
Below we explore some of the possible signs to look out for that may just lead to a property boom:
1. Thriving nearby towns
Newly up-and-coming areas often spring up next to towns and cities that are already popular. People that are priced out of that location and are looking to move as near as possible instead so look at areas in the nearby vicinity of already thriving towns as they might well see price appreciation. Out top tip for finding thriving cities in the UK is to check out the Centre for Cities website which is a leading think tank dedicated to improving the performance of UK city economies. Their 2019 Cities Outlook report provides some excellent insights on the topic.
2. Local demographics
Check free government websites and data so see how local demographics are changing over time. Consider the types of people that are living in that area – is it mostly young working professionals? families? retirees? Knowing the demographic make-up of an area can give early clues as to what types of properties are going to be most in demand in the future. One bedroom flats might do well in areas near London with a close commute to the City whereas larger homes might be a better bet in out-of-town locations where families will be looking to move. Generally, places that have a high percentage of the population being younger people will inevitably experience house price growth. The ONS releases periodic deep dive reports and data sheets on population and demographic trends across the UK and at the town level which provides useful clues as to the areas and towns that are seeing the highest growth rates in the long term.
3. New-build homes
New build residential developments can sometimes increase the value of surrounding properties and can draw investment from local businesses. Be warned, however, new housing developments can cut both ways when it comes to existing house prices in the area. Although new homes can bring price increases, a flurry of new properties flooding the market can sometimes increase supply and lower property prices in the area so be careful! The government website has a great tool that allows you to search for all new developments that need planning permission at the local authority level. Just enter the postcode of the neighbourhood you’re interested in on their planning decisions register.
4. Planning permissions
For the most diligent home movers among us, it’s always worth spending a bit more time researching an area for local planning permissions. Check with the local authority to see if any new schools or supermarkets are moving to the area which may well boost house prices. On the flip side, the planed opening of a new industrial estate near your house may seriously dampen house prices in the area. For planning permission and new builds alike, best to check the governments planning decisions register.
5. Regeneration plans
If your local authority is planning to invest in the town through regeneration projects then this will likely be a shot in the arm to local businesses and the economy which could in turn lift house prices in the area. Transformation plans aimed at making the area more desirable are always going to be positive for local properties and will likely boost demand in the future. The Department for International Trade releases periodic updates on the latest areas slated for property and infrastructure funding so be sure to check their status page for details impacting the area you’re interested in.
6. New transport links
Transport links are probably top of the list in terms of the biggest factors that draw in buyers and renters. Good transport links, a new train station, network connection, or major road developments is likely to make an area much more popular for commuters. Look for areas that have plans to improve local transport by checking for information from local councils. Check out Transport for London’s planning for the future website for details on transport plans and investment in the capital.
The opening of successful new restaurants, cafes and shops, particularly if they’re more up-market than other businesses in the area, is a key sign of an area on the up. Independent shops and services like delicatessens, florists, coffee shops, and boutiques suggest a more affluent area where local residents are willing to shop locally. However, if premium supermarkets, chain coffee shops and high street retailers have recently opened new stores in an area, it is possible that this area has already reached its growth potential. If you want this type of info nothing beats paying the area a visit but for those of us that are less than happy to schlep around towns and cities, Google street view does just fine 😉.
8. Good schools
The hunt for properties in the catchment zone of popular and highly rated schools attract a premium price. If a new school is being built or a nearby school has improved its Ofsted rating, you can bet local property prices will be driven higher in the medium term. The governments school comparison website gives free access to an amazing level of detail on Ofsted ratings.
9. New employers or industries
New employment opportunities in an area can drive up house prices as the business grows and employs more staff. Generally it’s best to look at areas that attract multiple different types of employers and within different sectors as areas that are overly reliant on the prospects of only 1 or 2 major employers could see house prices plummet if they get into financial difficulty or go bust. If a large employer is looking to move to the area, or an existing employer is recruiting more staff, there’s likely to be increased demand for properties as people which will drive up prices. Check out the ONS website which releases business formation statistics on the activity, size, and location of new businesses across the UK – a useful marker for areas that are seeing growth in employers!
10. Estate agent openings
Estate agents always move with the market and will only open a new office after thoroughly researching the area including market trends, public transport plans, job growth, and regeneration plans before taking the decision to open a new office. If there are a number of new estate agents deciding to set up stall in a new area it’s safe to assume the area will see decent house price growth in the near term. Look on the websites of nearly local estate agents to find where the outskirts of their current branches lie as that will typically see the most price potential in the next year or so. Have a look at the property hunters favourite tool Google maps to see how many and where estate agent offices are located in your target neighbourhood or have a look a large job sites like Indeed to track trends in estate agent job vacancies and postings in your area.
11. Home improvements & Extensions
If lots of properties in your neighbourhood are undergoing renovations, extensions, and improvements its likely that local residents are happy where they are and are looking to reinvest in their properties to improve them and the area. This tends to increase demand and shows that residents have found opportunities to profit from improving their homes in a bullish market. For planning permission, renovations and extensions, best to check the governments planning decisions register. You can also do some sleuthing 🕵️ yourself by calling up local traders in the area to see how business is faring in the neighbourhood!
12. Crime statistics
Online property portals and government websites make it easier than ever to check crime stats for any area. If crime stats are falling in a particular area that tends to be positive for house prices as a sign of regeneration in the area and a safer environment being more desirable to potential buyers. Before pulling the trigger on a property (excuse the pun none intended!) be sure to have a look at the UK Crime Stats website which is the leading crime and postcode data research and analysis platform.
13. Days on the market
Check in with your local estate agents to find out how properties are fairing in terms of the number of days they are on the market before selling or transacting. A steady and long-term decrease in the number of days it takes for buyers to take a property off the market is a great sign that the area is reaching up-and-coming status and is a great omen for future property prices in the area. Call your local estate agent and I’m sure they’d be happy to tell you but perhaps speak to a few and take the number they give with a bucket of salt!
14. Check Online Reviews
No list would be complete without mentioning HomeStar’s upcoming launch! No-one knows an area better than local residents so why not get their views before you decide to rent or buy a property. HomeStar’s neighbourhood review platform gives residents in the UK the opportunity to find and share ratings and reviews on what it’s like to live in any postcode in the UK. Our community of house hunters and general property snoopers/ enthusiasts can check thousands of resident reviews for free at HomeStar!