Dulwich property prices outperform rest of UK

Dulwich property and Dulwich Park

Knight Frank published a report this year that recently shook up UK property news. The company's research department discovered that Dulwich house price growth had rocketed 897% since 1995.This exceptional growth has exceeded that of any other area in the UK.

In the last three years, growth in Dulwich has been an impressive 53%. That in itself is a staggering increase. Dulwich Village has traditionally been one of south east London's most desirable destinations. It has a village aesthetic, albeit an entirely exclusive one, where a parade of independent shops and restaurants are sprinkled amongst Fired Earth, Care Rouge and village-style offerings. The central pub is, architecturally, an intact late Victorian/Edwardian masterpiece and traditional English wooden signposts navigate you around wide, grass-banked pavements. Picket fences and gravel drives sweep up to some seriously fabulous detached homes.

The beauty of the area is fiercely protected by the Dulwich Estate, who have owned the 1500-acre area for 400-years and directly benefit its schools. Edward Alleyn bought the Manor of Dulwich in 1605 and some of the country's top independent schools were founded here, all originating in some way from Alleyn's first charitable school for twelve local poor children. Today Dulwich College, JAGS and Alleyn's are all within minutes of each other and attract wealthy international buyers, politicians and celebrity families. It's also worth mentioning the local state primary is outstanding. As the Estate control the area's aesthetic, you simply can't convert your loft without their express permission.

Domestic buyers make up most of the neighbourhood's property search and are often families looking to find a home offering more value than central London. Trains at North, East and West Dulwich, Denmark Hill, Sydenham Hill and Herne Hill take commuters to London Bridge, Victoria and King's Cross while additional London Overground links are found at Denmark Hill and Peckham Rye. Buyers appreciate the large handsome terraces on offer that still give far better value that south west London. Prices per square foot range between £600-£1100 compared to Chiswick and Barnes where prices range between £800-£1300. These areas are directly comparable in terms of atmosphere and amenities; the Village offers Dulwich Park with a boating lake, good café and tennis courts and ancient Dulwich Woods where Charles I would often hunt. Dulwich Picture Gallery is John Soane's architectural masterpiece, famous for being the world's first purpose-built art gallery while Beauberry House is a local restaurant and bar in a stately Georgian mansion.

The 'ripple effect' is an industry term that means a surrounding area is positively affected by a property hotspot. Prices in nearby East Dulwich have also soared with Rightmove reporting a 50% increase since 2012. A four-bedroom period home near a good state primary school and transport would today be marketed at around £1.2-£1.4million, making most families in this area automatic property millionaires. East Dulwich's high street offers a boutique shopping experience and has attracted some notable chains (JoJo Maman Bebe, Gourmet Burger Kitchen), and all of the schools are performing well. Demand is coming from the trendiest parts of East London (Shoreditch, Dalston and Old Street) due to the Overground's arrival, and there's also been a long-term trend of buyers moving across from more expensive Clapham and Battersea. All of these areas are comparable as they offer good restaurants, bars, transport and schools - yet East Dulwich is somewhat greener.

Prices in East Dulwich have now been pushed up enough to begin to catching up with its more expensive migration sources. To see what we mean, Rightmove tells us that Clapham prices have risen 35% since 2012 (as mentioned, East Dulwich has risen 50%). Over the last year, East Dulwich prices have risen 10% and Clapham 5%. From the Knight Frank research it's also worth noting that Peckham Rye, a direct neighbour of East Dulwich, recorded the second largest high price rise at 820% growth.

If you are considering moving from Dulwich or East Dulwich, then 2016 could well be the year to do it while prices remain at a peak. Different economists predict interest rate rises beginning next year at any time from spring to December, but these will likely be gentle. When rates start to rise, the market can't rise so ferociously. What is clear is that the remarkable growth seen in these areas will be extremely difficult to sustain.