Date Published 11 April 2016
Over the past week I have had a number of enquiries regarding my previous two articles concerning the Howard De Walden Estate and the Portman Estate. A variety of clients feel that investing within these two Marylebone giants' perimeters is certainly the way forward, offering plenty of rewards and that the asking prices when paired with the rental values certainly makes good investment sense – bringing about great investment yields. However, these clients have asked me to dig a bit deeper and find out how positive the rate of capital growth is within the two estates – and to play a bit of devil's advocate, let's see how they fare against one another! In order to investigate the capital growth of these estates and to judge them against each other, finding out which estate is currently more investment-worthy, I will be using 4 streets and displaying 3 bedroom flats as my focus point. For a sense of continuation and deeper exploration, I will be using the same streets that I focused on with last week's article for the Portman Estate, but off course outlining the capital growth this time round, rather than the particular investment returns. As for the Howard De Walden Estate, I will be selecting 2 various streets within their domain, but which also hold great influence and notable importance in the area. In overall, I will be outlining the capital growth of these streets over the last 10 years and what these trends allow us to predict for the next 5 years.
The Howard De Walden Estate area:
Harley Street (W1G):
· Average Purchase Price of 3 bedroom properties in 2005: £748,576 - Average Market Price in 2010: £1,110,137 (Capital Growth = 39.5%)
· Average Purchase Price of 3 bedroom properties in 2011: £1,202,113 - Average Market Price in 2016: £1,697,997 (Capital Growth = 34.5%)
· Average Capital Growth of both 5 year periods: 37%- Difference of Capital Growth = -5%
· Predicted Average Capital Growth between 2016 – 2021= 32% - (6.4% annually)
· Predicted Capital Growth between 2016 – 2021 based on current trends= 29.5% (5.9% annually)
Weymouth Street (W1G):
· Average Purchase Price of 3 bedroom properties in 2005: £533,200 - Average Market Price in 2010: £809,300 (Capital Growth = 42%)
· Average Purchase Price of 3 bedroom properties in 2011: £902,000 - Average Market Price in 2016: £1,406,700 (Capital Growth = 44.5%)
· Average Capital Growth of both 5 year periods: 43.25% - Difference of Capital Growth = 2.5%
· Predicted Average Capital Growth between 2016 – 2021= 45.75% - (9.15% annually)
· Predicted Capital Growth between 2016 – 2021 based on current trends= 47% (9.4% annually)
The Portman Estate area:
Seymour Place (W1H):
· Average Purchase Price of 3 bedroom properties in 2005: £604,246 – Average Market Price in 2010: £914,500 (Capital Growth = 41.5%)
· Average Purchase Price of 3 bedroom properties in 2011: £986,000 – Average Market Price in 2016: £1,652,750 (Capital Growth = 52%)
· Average Capital Growth of both 5 year periods: 46.75% - Difference of Capital Growth = +10.5%
· Predicted Average Capital Growth between 2016 – 2021= 57.25% - (11.45% annually)
· Predicted Growth between 2016 – 2021 based on current trends= 62.5% - (12.5% annually)
Chiltern Street (W1U)
· Average Purchase Price of 3 bedroom properties in 2005: £647,909 – Average Market Price in 2010: £1,176,875 (Capital Growth= 60%)
· Average Purchase Price of 3 bedroom properties in 2011: £1,253,725 – Average Market Price in 2016: £2,385,883 (Capital Growth = 64.5%)
· Average Capital Growth of both 5 year periods: 62.25% - Difference of Capital Growth = +4.5%
· Predicted Average Capital Growth between 2016 – 2021 based on current trends = 69% - (13.8% annually)
From our results, we can see that both the Portman Estate's as well as the Howard De Walden estate's perimeters both hold very good capital growths for 3 bedroom properties, which would bring about financially lucrative rewards to anyone wanting to invest in a property here. The Portman Estate in particular has performed extremely well over the last 10 years with an average capital growth percentage of 54.5% for residences possessing 3 bedrooms (using Chiltern Street and Seymour Place as our representatives). This is particularly impressive with Chiltern Street, where capital growth has reached around 64.5% between 2011 and 2016! The next 5 years also greatly fills us with optimism with predicted capital growth (based on current trends), for 3 bedroom properties, suggesting a growth in the region of 62.5% for Seymour Place, and a whopping 69% forecasted for Chiltern Street. In comparison, the area surrounding the Howard De Walden Estate also boasts a relatively high capital growth for 3 bedroom properties, with an average 40.12% being emitted over the last 10 years from Weymouth Street and Harley Street combined. Taking a closer inspection on these two streets, you will notice that for 3 bedroom properties Weymouth Street performs slightly higher than Harley Street, with an average capital growth of 43.25% (since 2005) - compared to Harley Street's average of 37% in the same period of time. Even though it can be generally consented to that the Howard De Walden area is slightly more prestigious in terms of the repute and history of many of its streets, we see that 3 bedroom properties here have been excavated to such an extent, where prices have reached such lucrative levels that the rate of capital growth isn't as rapid as it is in the Portman Estate area. I would say that there is more manoeuvrability for capital growth in the Portman Estate perimeter, as the maximum potential for properties here are still to be reached, where prices are yet to reach the money-spinning levels of the Howard De Walden area and possibly an investment here currently would see a higher level of capital growth in the future. Streets and properties on the Portman Estate, just like with the Howard De Walden area, benefit highly from this group's direct influence financially, as well as from the reputation they bring, the marketing elements and the community feel they work so hard to achieve. Investing in a property within either estate would be a very smart move, but an investment in the Portman Estate area currently I feel would achieve a greater thrust in terms of capital growth movement – whilst retaining a similar repute, both growing as well as currently in place, alike to the Howard De Walden Estate. With 3 bedroom properties in particular, by analysing our results, there are great indications that there is a lot of capital growth catch up to be done in the Portman Estate area, where the probability of closing the gap with streets on the Howard De Walden area is imminent and happening right now. In order to close this market price gap, capital growth is going to be a key balancer, so buying a property here now could take your property to soaring prices in a close timeframe. Capital growth will undoubtedly increase in the Howard De Walden area too, but the region falling into the Portman Estate, in my opinion, is certainly ripe for the picking and one that should definitely be taken advantage of sooner rather than later!
If you would like any more information regarding capital growth in the areas covering the Portman Estate and the Howard De Walden Estate, or even about capital growth in Marylebone more generally – please get in touch with me; two minds offering different perspectives are usually better than one.
