April 2020 Newsletter
It is obviously with deep sadness that our current newsletter comes during such difficult times. With only virtual viewings possible at the moment, we are still open for business; steering through on-going transactions; searching for investment opportunities for those with an appetite to enter the market; and finally helping those clients who want to use some of their free time to start the ground work on their next purchase. We are busy discussing the pros and cons of various parts of London and the Home Counties and using industry databases to collate examples of properties that could meet individual requirements.
Here is our latest round-up of the current, Covid-19 and non Covid-19, talking points in the London property market.
Exchanged but not completed? – Removal companies are still working, try Dumond and Clock Work Removals both of whom are currently assisting our clients. They can advise on how to move within the current government guidelines.
Under offer but not exchanged? – All but one of our clients have proceeded to exchange of contracts over the past four weeks. We successfully renegotiated the prices on some purchases. One client, however, has paused the transaction and is looking to take advantage of falling interest rates. They have applied for and obtained a better mortgage deal. We are now waiting to see if we can agree a lower price.
Auction success confirms underlying demand – Savills moved its 26 March property auction on-line with remote bidding for the first time. The move proved to be a success with 67% of the lots selling. Although many were lower value offerings, 5 properties sold for over a £1m. Properties sold across the whole of London including Hampstead, Kilburn and Hackney. (PW)
Vauxhall regeneration approved this week – Two skyscrapers, a 54- and a 42-storey towers, designed by the late Dame Zaha Hadid’s ZHA practice, and set to be built at the centre of Vauxhall’s notorious gyratory system have been given the final go-ahead after a long planning battle. The North tower will have 257 homes and the South tower will house a 618-room luxury hotel. They will be connected by a podium at the 10th storey. Only 23 of the apartments at the site are classified as “affordable” but a £30 million payment to Lambeth council is expected to fund 54 homes elsewhere in the borough.
Eco Trend – Electrical car charging points – In our last newsletter we mentioned Green Walls as a trend to look out for in the near future. Another trend is that of fitting electrical charging points in new developments as standard. Bishops’ Gate in Fulham, a recently completed development of about 50 flats and houses, claims to be the first new development in London where all resident parking spaces come fitted with charging points.
Cladding 3 years on – Across London and the UK, thousands of would-be vendors are living in flats they cannot sell because the external walls are covered in cladding. In the aftermath of the Grenfell tragedy, to obtain a mortgage, lenders are insisting on receiving specialist cladding reports before making offers. With a large increase in the cost of professional indemnity insurance for these specialist surveyors, many have withdrawn from the market. This makes it very difficult for freeholders to organise inspections and is creating a backlog. At the same time, even cash buyers are being advised not to proceed without seeing a report. The costs of rectifying defective cladding are high and can increase service charges for several years. Before making an offer on any property built since the 1960s, do ask the estate agent whether a cladding report has been produced before incurring mortgage application and legal fees. (BBC & JWA)
The ongoing success of King’s Cross, a once-seedy area known for its clubs, drugs and sex industry is in many ways an example of successful regeneration. Aside from the 12,000 residents, the 27-hectare scheme will have a working population of 30,000 by 2023. The first residential properties sold in 2011 for £850 per sqft and are now selling at an average of £1500 per sqft.
Airbnb in your block? – The FT recently reported that London has around 70,000 active listings for short term lets (before the current lockdown), far more than New York or Paris (both count around 40,000 listings) but that only 14% of London residents think it is a problem. This is surprising to us, our own experience of day-to-day life in well-managed blocks indicates that short-terms lets are seen very negatively by mid and long-term residents. Most apartment leases prevent carrying out a business activity from a residential flat and Airbnb falls into this category. If you suspect Airbnb activity in your block and are unhappy about it your first port of call is the managing agents. (FT and JWA).
The high cost of Ex-Local Authority flats – The Guardian recently reported the case of a 40 apartment local authority block in Camberwell, of which 29 flats are privately owned, where private leaseholders have each been asked to contribute £24,000 towards a new heating system and £2,000 to have their front doors repainted. We have heard, for many years, of cases of Right-to-Buy and privately bought ex-local authority flats being unfairly burdened with repair and improvement costs, without much transparency offered by the Council. We always flag this to clients, in this case often younger, in search of a first good value flat. (Guardian and JWA).
Kensington Tesco redevelopment -The partial redevelopment of 100 West Cromwell Road in Kensington and Chelsea, at the intersection of Cromwell Road and Warwick Road, has finally be approved. The consent includes the erection of 8 buildings up to a maximum of 22 storeys. These will deliver 427 new homes, a new leisure centre, gym and pool, along with commercial/retail premises and new public spaces. We understand the Tesco superstore will remain on site!
We very much hope that you find this update concise and informative. Please do feel free to contact us if you would like to discuss any aspect of the London property market.