Why Invest in Slough Buy-to-Let Property 2020
Introduction to Slough
As the London Commuter Belt continues to benefit from declining prices in the London market, we’re seeing Commuter Towns generate incredible levels of tenant demand amidst rising property prices.
One of the most established towns in the London Commuter Belt, Slough is a commercial powerhouse at the heart of a localised economy worth around £9 billion. Thanks to improved transport links, a £1.5 billion regeneration project beginning to take shape throughout the town and a relatively affordable market when compared to London, Slough is a true property investment hotspot.
Economy and Employment
Home to over 5,400 businesses, Slough has the highest concentration of global companies outside of London, all of which contribute to an economy that delivers a turnover of £9 billion. As an established place to invest commercially, Slough is using this foundation to improve infrastructure and drive inward investment.
With a gross value added (GVA) – essentially the value generated by anything that engages with the production of goods or services – of £82,000 per worker, Slough is the most productive urban area in the country. This puts it ahead of both the national average (£57,000) and London (£80,000), demonstrating the sway it holds with working professionals.
Regeneration in Slough
As demand from professionals grows, Slough is executing a total regeneration of its existing landscape, building iconic new destinations as well as mixed-use residential, commercial and infrastructure developments. By redefining the amenities available, Slough is hoping to attract the demand from a London market that continues to see renters leaving. With 46% of homes in Slough currently let to people leaving the capital, this has had a knock-on effect on property price growth.
Led by the Slough Urban Renewal, regeneration in Slough is impacting all sectors including residential, commercial, leisure and education. The Curve and The Centre are two of the primary redevelopments, both of which heavily contribute to the cultural offering in the town. The Curve is a £17 million library and ‘cultural hub’, providing a new performance and teaching space as well as offices and a cafe.
In terms of leisure, developments such as Arbour Park Community Sports Facility, the Ice Arena and a new leisure centre on the Farnham Road ensure that Slough is a place for residents to both work and live. Slough Ice Arena is particularly impressive – a striking building that hosts an ice rink, climbing wall, gym and more. Residentially, we’re seeing a range of new housing developments including Steel House and New Eton House, two SevenCapital developments that are designed for the modern professional seeking quality and luxury.
Finally, Crossrail is delivering the infrastructure improvements to handle increased demand, ensuring efficient access across the South East. With more direct links, increased capacity and lower travel times, Crossrail is the ideal project for a region that thrives on connectivity.
Property Prices and Rental Yield in Slough
Figures from Zoopla show that Slough property values have increased by 230% since 1999, demonstrating the strength of the local property market. With the current average value sitting at around £403,503, compared to London’s £653,828, affordability in Slough is playing a huge part in increased demand.
This affordability has also contributed to Slough’s above-average rental yield performance, currently sitting between 4% and 5% according to TotallyMoney.
Looking ahead, prices in the South East are set to outpace the UK average by 2022 according to PwC, increasing by 3.3% on average over the next three years. This cements Slough as a growth hotspot, with JLL ranking the Commuter Town as having the 4th highest ‘long-term potential’ along the wider Commuter Belt.
So why invest in Slough Buy-to-Let property in 2020? From the thriving commercial sector to the unprecedented accessibility it offers across the South East, we look at why investors are seeing Slough as a Buy-to-let hotspot and examine the unique opportunities offered by this Commuter Town on the rise.
One of the most important developments for Slough, Crossrail is a £14.8 billion rail line that will heavily impact the South East market going forward. Officially named ‘The Elizabeth Line’, Crossrail is aiming to build direct routes between key destinations across the region – including the capital – as well as improving travel times and increase carrying capacity. Plans show that when it goes live, Crossrail will put another 1.5 million people within 45 minutes of central London.
While the first phase of Crossrail – the central section – was originally planned to start operating in 2020, Crossrail Ltd have now announced that it will open ‘as practically possible in 2021’. This will allow for further time to complete software developments for signalling and train systems as well as complete safety approval processes for the line itself.
It’s expected that the new delivery window line services through to central London will be between October 2020 and March 2021.
For investors, the completion of Crossrail should be on the radar. According to the GVA Crossrail Property Impact Regeneration study, “the core influence of Crossrail in value terms appears to be that it reinforces the strongest markets”. The same report forecasts that Slough will see a 19% property price uplift by 2021 and 29% before 2026, as Crossrail adds to a world-class network of travel links that will soon be joined by the Western Rail Access to Heathrow.
Heart of Slough
Established in 2009, the ‘Heart of Slough’ program is designed to regenerate the town centre, creating a cultural quarter for creative media, information and communications industries in the town. Originally a £400 million plan, the ‘Heart of Slough’ has played a huge part in redeveloping the bus station, Queensmere Observatory Shopping Centre and the old railway station.
It has also resulted in the development of two new buildings, a £1 billion learning centre named The Curve which completed in 2015 and The Centre, a state-of-the-art leisure centre that started construction in 2017. Built alongside Slough Urban Renewal, both of these developments represent the continuing commitment by Slough Council to improve amenities in the town as demand continues to increase.
Further investment into Slough is being led by Slough Urban Renewal and includes a multitude of leisure, residential, educational and commercial space as well as new hotels and restaurants. With plans to continue regenerating into 2022 and beyond, Slough Borough Council is pushing ahead with a development plan that has now amounted to around £1.5 billion in total investment.
Our developments are ideally placed to take advantage of new retail and leisure amenities as well as long-term house price growth. Queensmere Observatory has become a key retail destination, delivering a number of high-street brands for the town. Slough’s regeneration plan also continues to invest in resident health with a number of leisure and fitness developments including The Centre, Arbour Park and the Ice Arena.
Property Investment Opportunities in Slough
As a property developer with a number of opportunities in Slough, we’re actively contributing to the inwards investment that the town is facing. We understand emerging markets and Slough is demonstrating the opportunities that make it ideal for a variety of different investment demographics and strategies.
Iron House is nestled on the doorstep of Slough’s world-class transport links including Crossrail. The ideal development for residents that need connectivity and privacy, Iron House offers exclusive community living and is designed for residents that want to reach London or Heathrow Airport in under 20 minutes. Slough is a commuter paradise and Steel House is tailor-made for the exacting, professional commuter.
New Eton House, Slough is a landmark residential development for the town. Located just a stone’s throw from the town’s thriving commercial centre on the Bath Road, New Eton House is light, spacious and airy, designed to fit a clear gap in the market for high-end luxury boutique apartments.
It’s expected that in 2020, Slough will continue to benefit from the growth occurring across the wider South East. As key developments approach completion and more flexible, mixed-use spaces appear in various sectors, Slough is ensuring that residents have the amenities they need to hand, meeting the demand of professionals that are flocking to the town.
Building on Slough’s established connectivity is vital for encouraging growth and both Crossrail and Western Rail Access to Heathrow will help encourage commuters looking for affordability and quality to choose Slough. Expect the town’s population of 145,000 to grow exponentially as these transport links complete and London renters continue to leave an overly expensive market. With ONS statistics showing that nearly 340,000 people left London in 2018 alone, the year-on-year number has risen 33% since 2012.
Finally, as regional locations continue to perform up and down the country, Slough’s market-leading productivity will be a stand out signpost for investors heading into 2020 and beyond, demonstrating the huge demand that the town continues to face as it attracts ambitious workers and global business brands.