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Is Hackney still the best place to buy property?

The existing home market in Hackney is finally showing signs of slowing down after more than 10 years of almost uninterrupted price growth.

Homes in the borough of East London are now selling for nearly £568,000 ($696,000), largely unchanged since the end of 2021, according to an analysis of UK land registry data by Bloomberg News that smooths the data to remove aberrant transactions.

Property prices in the area soared after the financial crisis as the area saw an influx of hipsters working in the tech and creative industries who had been pushed out of neighboring Islington.

That has helped it become the capital’s best-performing borough over the past decade, when price appreciation and percentage gains are combined, according to Anthony Codling, chief executive of property platform Twindig.

The borough could now prove a bellwether for London’s housing market after an influx of tech workers, who could afford the down payment for houses as their stock options rose in value , has helped push prices beyond the means of most locals.

Shares of key technology employers such as Amazon.com Inc. and Alphabet Inc. have soared in recent years, only to suffer badly this year due to falling markets. Shares of Meta Platforms Inc. have fallen more than 40% this year, while shares of Amazon are down about a third, limiting the buying power of potential buyers. Inventories have more than doubled over the past five years.

Meanwhile, rents in London rose 15.7% last year to nearly £1,700 a month, according to property platform Zoopla. This exceeded the 9.1% increase in the rest of the country as people begin to return to the capital. A record 30% of rental accommodation in London this year went to people who previously lived outside the city, the Hamptons estate agent said on Monday.

Read more: London’s great property exodus reverses as tenants return

While property values ​​have risen significantly in Hackney since January 2018, asking and selling prices in the borough and its adjoining areas appear to be softening, according to an overview from data provider TwentyCi. The firm warned that this could be due to the type of property that is coming to market.

To slow down

Median resale price (trend)

Contains data from the HM Land Registry © Crown Copyright and Database Right 2021.

Sales volume is showing the first signs of a slight slowdown, according to the same analysis.

The downturn contrasts with Waltham Forest, where many of those priced out of Hackney opted to buy. Adjusted prices in this borough rose 14.5% in the five years to February, according to Bloomberg figures, compared to an 8.5% gain for Hackney over the same period.

Hackney could follow in Islington’s footsteps in becoming unaffordable for many buyers, meaning another borough could become the city’s next hotspot, Codling told Twindig.

“Where will it be? Probably somewhere along the Elizabeth line,’ he said, referring to the new London rail line, which will open on May 24, which will link Heathrow airport in the west with Canary Wharf and areas further east.

Source: UK Land Registry, Bloomberg report

Edited by: Adam Blenford
Research by: Julian Burgess, Brittany Harris, Neil Callanan
Design and development: Julian Burgess, Brittany Harris, Jeremy Diamond and Hayley Warren

Methodology: Bloomberg analyzed all residential property sales from data produced by Land Registry © Crown copyright 2016 and compared them to 12 months earlier. We excluded real estate sales that did not have a valid postal code. Median prices were seasonally adjusted using an independent LOESS regression model for each zone. Cadastre figures do not include house sales made by transfer of business and sales below the market.

The map images on this page contain Ordnance Survey data © Crown copyright and database right 2012, Royal Mail data © Royal Mail copyright and database right 2012, National Statistics data © Crown copyright and database right data 2012, Postal Boundaries © GeoLytix 2012 copyright and database right 2012.

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