Most new London development will come in the east of the city

Most new London development will come in the east of the city

The centre of gravity in the London property market is set to see a shift to the east over the next few years, according to the latest analysis from Savills. 

It said that more than a third of homes that are planned for building over the course of the next five years will be constructed east of the capital's financial district, amounting to some 55,000 homes being erected in just four boroughs in the space of just five years. 

This news of strong development and a shift in momentum comes just weeks after another report said that the rental market in the capital was also experiencing a swing, with more people now looking to rent one and two-bedroom properties than ever before. 

Savills said that the move will see Newham, Tower Hamlets, Greenwich and Barking and Dagenham become the stars of East London's property market, with these four alone accounting for 29 per cent of all homes to be constructed in the next few years. 

So why is the momentum shifting towards the east of the financial district? According to the international property advisor, the move can mostly be attributed to the fact that the Olympics unlocked the area in 2012, showing off what it has to offer. 

"The Olympics played a hugely important role in opening up the area to investment and transport improvements are now driving occupier, investor and developer demand in previously overlooked East London postcodes," said Susan Emmett, Savills residential research director.

"This is changing the shape of London and its property market, with a discernible pattern of emerging development hugging the East London Line portion of the new London Overground. The network extension to Barking Riverside and the completion of Crossrail with give a further boost," she added. 

The east of the city also offers investors the chance to buy into an area wherein they could make impressive capital gains over the next few years. Properties in the area are far cheaper than the likes of Kensington and Westminster, which means it costs less to invest, but they are also picking up in terms of price, which could leave buyers with a fantastic return somewhere down the line.