Surrey Area Guide
Your free guide to Property Investment in
Surrey
This property investment guide examines the county of Surrey and therefore covers an area close to the subjects of other previous guides – including Sussex and the central south coast of England. It looks at the character of this, England’s most wooded county, and the differing conditions across its various towns and villages.
In our free downloadable guide, we’ll consider some of the factors that affect investment conditions across the county. They include:
· Strategic Position
· The Regional Economy
· Population and Demographics
· Economic Data
· Regeneration and Inward Investment
· Key Towns
· The Surrey Housing Market
· Local Market Variations
· Local Property Market Profiles
· Property Market Predictions
Download our free guide to Property Investment in
Surrey
Why Invest in Surrey?
An Overview
It isn’t especially helpful to regard Surrey as a single property market. Despite its proximity to London, much of it is comparatively rural with a great deal of open green space, punctuated by isolated villages and smaller towns. Each of these conurbations has its own character – some appealing to busy commuters, others to tourists, students, business delegates or the recently retired. In short, the county is an amalgamation of disparate markets, some of which will be particularly attractive to investors, according to their specific interests, goals and priorities.
Faced with such a diversity of locations, choosing a shortlist for investment is very much a matter of personal preference and priority. Key attractions include:
· Income-security: Surrey is one of the UK’s most affluent counties
· Economic strength: it has an economy valued at around £43bn
· Strong housing demand, coupled with limited supply
Strategic Position
One important reason for Surrey’s appeal is its proximity to London. Some of its towns and villages lie close to the M3 motorway, and those set close to its various junctions make particularly convenient commuter-belt destinations. In the same vein, others lie close to the M25, or other arterial routes such as the A3, the A24 and the M23.
Economically, too, its location works in its favour. The capital lies just to its east, there are several busy ports and resorts a short way to the south, and the wider region is home to a host of internationally renowned universities and R&D centres. This all helps to keep the local economy buoyant – supporting higher earnings and levels of employment – and this, in turn, helps to support rising values in the property market.
Geography also helps to maintain short-stay demand on the part of tourists and outdoor enthusiasts. The county borders encompass some of the most scenic countryside in Britain, and many beautiful spaces are within very easy reach.
The Regional Economy
The economy of the South East is large and active. The region is reportedly the largest economic contributor outside London. The Enterprise M3 Local Enterprise Partnership (LEP) reports that there are 65,00 active businesses in Surrey. It also notes that it is supporting the growth of the region’s low carbon sector, which is now worth over £18 billion.
Population & Demographics
Population is not uniformly spread across the county, but it is certainly growing. Surrey County Council estimates the county population at around 1.2 million, but expects more than 37,500 extra residents to settle here over the next 20 years.
Population is a key driver of demand, but similarly important are average incomes, which dictate people’s ability to pay rent, and the capacity of buyers to support rising capital values. Surrey is notable for exceeding the UK averages on mean incomes, skills and training, and its proportion of economically active residents.
Economic Data
Population (Surrey) 1.18 million
Population growth forecast (by 2043) +37,500
Average earnings +22% higher than UK average
GVA per head (Surrey) £34,070
GVA per had (UK) £32,876
Regeneration and Inward Investment
Surrey has an impressive £1 billion capital and infrastructure programme, and by 2030 the County Council expects to see 4,000 new jobs created in the field of low-emission vehicles and infrastructure. It is committing millions to digital connectivity and transport improvements, and these are being supplemented by multimillion-pound urban regeneration masterplans within many of Surrey’s constituent towns.
Each of these schemes – together with the creation of numerous outlying commercial and industrial parks – should help to support further employment growth and help to support improving living conditions across the county.
Key Towns
Local towns all have distinctive characters and different types of market appeal. It’s beyond the scope of this guide to give detailed information about each, but our downloadable guide provides short introductions to some of them:
· Guildford: the largest local authority area in the county and home to the University of Surrey.
· Woking: another of Surrey’s largest towns.
· Farnham: a picturesque market town and recently one of Rightmove’s top 3 UK destinations for capital growth.
· Epsom: a popular commuter-belt location set close to London.
The Surrey Housing Market
Surrey house prices are high by national standards. According to Zoopla’s July 2022 house price index, average local values stood at £642,894, which compare against the UK mean of £256,900.
Higher-than-average disposable incomes within the county have clearly helped to support capital growth. Gains vary considerably by town and ward, but values have generally been rising. As a regional average, Zoopla estimates a rate of +8.2% for the South East. Much of that is the result of strong demand set against severe restrictions on supply. The result is a long-standing imbalance that has driven capital values higher. Similar dynamics have done much the same for rental values.
Local Market Variations
Our guide uses house price data from Zoopla to show how average property values (all types) vary between locations. Surrey Heath, for example, is one of the more affordable and high-yielding districts, while Elmbridge is characterised by much higher prices but lower yields. Generally speaking, lower purchase costs tend to support better yields overall. Consequently, the more affordable districts such as Surrey Heath may work better for investors who prioritise gross yields.
In our downloadable guide, we consider three locations as examples of Surrey’s diversity:
· Surrey Heath, one of Surrey’s strongest markets for yields;
· Farnham, which has seen some of the fastest rates of capital growth; and
· Guildford, which is home to the University of Surrey and the county’s largest town by local authority population.
Please see the guide for further details.
Local Property Market Profiles
UK-wide capital growth forecasts for 2022 are averaging around +5% by the year-end. Savills is predicting cumulative price growth of +17.4% by 2026 but, given the relatively high cost of property in the South East, it forecasts 5-year growth of just +13.5% across the region. At a more local level, however, it’s likely that some of Surrey’s most popular commuter-belt communities will outperform this regional forecast.
Investors may well see the best returns from locations characterised by:
· Good connections by rail and road
· Relatively affordable prices
· Strong and reliable demand for housing
· Significantly constrained supply
Evidence of economic growth and a rising local population should also be good indicators of an attractive and potentially rewarding market.
Property Market Predictions
For more details, including links to data sources, please download our full report below
