Updated: 5 days ago
Average Sales Value: £1.7m
Average £/per square foot sales value: £555
Percentage of stock sold off-market: c35%
Once referred to as the "Gin and Jags belt" when 1980's stockbrokers zoomed around in convertible sports cars, today Cobham is more often referred to as The Beverely Hills of England. Using in-house data, Ludgrove has created a Prime Cobham House Price Index (the first index of its kind in the industry) and below we outline 5 reasons why we think Cobham is set to perform strongly in the coming years.
1. Prices Below Trend
In common with all UK prime markets, the Cobham property market stalled in the 6 years from 2014 as tax changes, the threat of a hard-left Government and Brexit uncertainty discouraged buyers. Although prices didn't fall materially during that period, the period of uncertainty was exceptional with prices moving sideways for 6 years and only recently passing their 2014 peak. (In context it took prices 3 years to regain their peak following the Financial Crisis). Prices remains below trend despite the recent uptick, and we expect a follow-through in the years ahead:
2. Cheap Relative to London
In the 20 years to 2014, Cobham property typically traded around 4x the value of London property (vs 3.4x today). A reversion to the pre-2014 ratio would see +18% upside in Cobham property values and if prices were to reach the 4.6x ratio seen in 1999, prices would increase by +35% (ceteris paribus):
3. Best in Class Rental Yields
Rental yields are the best determinant of value and below we look at yields in prime UK property markets (which we define as areas where the asking prices exceed £750,000). Here, Cobham stands out as the clear winner with a yield of 4.8% vs 3.2% across the leading prime regions.
We don't think it would be unreasonable for Cobham yields to compress to around 4% (in line with nearby Virginia Water). Assuming rents remain unchanged, this would imply +20% upside in local house prices. If rental values continue to grow (and there is currently a significant shortage of rental stock in the area) then capital growth may be even higher:
4. The Race for Space
We commented in our last newsletter ("The Race for Space") on the heightened demand for more roomy properties with outside space. Here we calculated the premium buyers were willing to pay for houses over flats in Prime Central London had almost doubled to 18%.
We believe this trend will be sustained and the elevated premium for houses will continue to ripple down the commuter belt which will clearly benefit areas such as Cobham.
5. Proximity to London & Amenities - a good "each way bet"
Understandably some homebuyers are cautious regarding the extent to which working from home will be the new norm. After all it might be a brave call to move to the deepest countryside only to find out in 12 months time their employer has moved back to 4 or 5 days working in the office, or personal employment circumstances have changed and a new role beckons back in London. Cobham with its mix of spacious properties, short commuting distance (35 minutes to Central London) and "London-lite" local amenities (restaurants, bars and shops) offers a good "each way bet" so to speak.
The Terrace at The Ivy Restaurant Cobham. Image : The Ivy
If you are looking for a property in Cobham or the surrounding areas, feel free to get in touch with Ludgrove. Off-market sales are currently around 35% of transactions and we have access to a range of off-market properties in the local area. For case studies showing how we can add value to property buyers, please click here.
Contact: Fraser Slater CEO of Ludgrove Property Ltd Tel: 0207 889 2860 Email: firstname.lastname@example.org
About: Ludgrove is a research-driven London property buying agency, sourcing properties for home-owners, investors, family offices and developers. The company is the only UK buying agency that conducts in-depth research into the Prime London property market and their research regularly features in The Times, Forbes Magazine, Property Week, PrimeResi, Mansion Global and others. As well as conducting searches for homeowners, Ludgrove sources and appraises off-market apartment blocks and development opportunities, adding considerable value to Investors and Developers. The agency is ranked one of the top UK buying agencies by Prime Resi. CEO and Founder Fraser Slater is a former Real Estate Analyst and Fund Manager. His former fund WDB Capital was one of the best performing Funds in Europe during the Financial Crisis. Co-Founder Isabella Slater is an interior designer. Disclaimer: Ludgrove Property Limited is not authorised or regulated by the Financial Conduct Authority (FCA) and we do not provide any financial or investment advice. We recommend that any property investor seeks appropriate professional advice before entering into any contract, and we would also advise that the value of any investment can go down as well as up and that you might not get back what you put in. You may have difficulty selling a property investment at a reasonable price and in some circumstances it might be difficult to sell at any price. We would urge you not to invest unless you have carefully thought about whether you can afford it and whether it is right for you, and if necessary to consult with a professional advisor in accordance with the Financial Services and Markets Act 2000. All information is provided strictly as a guide only, is subject to change without prior notice and does not constitute an offer of investment. The Ludgrove website should not be regarded as an offer or solicitation to conduct investment business, as defined by the Financial Services and Markets Act 2000. Investors who are resident in or citizens of countries other than the United Kingdom may be subject to local restrictions. In particular, no offer or invitation is made to any US persons (being residents of the United States of America or partnerships or corporations organised under the laws of the United States of America or any state, territory or possession thereof), who are excluded from the services offered in this site. The information on this website and our publications has been obtained from sources which we believe to be reliable and accurate, but without further investigation this cannot be warranted.