March 2018 Newsletter
We hope you had a great start to 2018! Here is our latest round up of the current talking points in the London property market.
Earls Court – The housing minister Dominic Raab has hinted that he is on the side of the residents of Earls Court in their long-running battle against the developer to save their homes in the heart of the £12bn scheme. In the past two years the value of the site has gone by nearly 30% and sales of off plans units have slowed down. (PW)
Chiswick – This west London old English heartland (75% of 2017 buyers were from the UK), has seen its prices drop by 0.3% in 2017 vs nearly 5% in Central London. This is due in part to the fact that 40% of buyers live locally and also because 50% of buyers are actually moving from central London, where price per sqft can easily be 50% higher than Chiswick’s £800-£900. (FT/Savills/Knight Frank)
Nine Elms – With the recent opening of the US Embassy in Nine Elms – Battersea, others are following. Apple will move its UK headquarters to the renovated Power Station, Penguin Random House is moving into 1 Embassy Gardens, whilst the Dutch Embassy is planning to move next door to the US Embassy. There are over 19 residential sites (approx. 20,000 new apartments), several of the sites are already completed and occupied, while others are still with planning for approval. There are flats being sold off plan and others on the secondary market, as investors who bought early on are looking to make a quick turn. Building work is set to continue for at least another 7 years, with two new tube stations to be built at Nine Elms and Battersea Power Station (targeted for completion in 2020). (JWAA)
Canary Wharf – Thousands of new apartments are also being built in Canary Wharf, completing from 2020. They range in price from £1,100 per square foot to £1,600 per square foot, and compete to offer the best amenities, including the highest fitness centre in Europe with views over the Thames and the City and a 25 meter outdoor/indoor swimming pool via spectacular internal gardens on various floors. But with so many towers rising in the next few years, in what is a very confined space, the toughest challenge in choosing the right investment, is to work out the views that an apartment will enjoy in the long term. (JWAA)
Hackney Wick – This once forgotten artistic enclave of East London received a major boost, in property terms, from the neighbouring 2012 Olympics. Since then prices have gone up over 50%. Buyers are mostly aged 30-35, moving from more central locations like Shoreditch where prices are at £1,000 per sqft and over, to Hackney Wick’s £750 (FT/Hamptons/JLL)
Knightsbridge – the relative attractiveness of areas such as Chiswick and Hackney Wick stands in contrast with the recent fate of a prime London spot such as Knightsbridge where prices per sqft still go up to £6,000. However whilst prices went up by around 80% in the period 2005-2015, they have since receded by around 15%. (FT/Lonres/Savills)
Ground rents – new rules have put a stop to the recently engineered ground rent income streams for developers. Ground rents on new leases will be set to zero. This ban on ground rents is not retrospective, but we expect a number of legal actions against developers, particularly for recent transactions, with higher ground rents. (MW)
Lease extensions – the recent high profile legal challenge against the Sloane Stanley Estate to make leasehold extension cheaper did not succeed. For the time being, properties with leases under 80 years remaining will continue to suffer a more limited demand. (PW)
JBSP Mortgages (joint borrower sole proprietor) are becoming more popular. They are well suited for parents inclined to help their children. Whilst allowing a family member to be party to a mortgage with their income, there will be no additional 3% stamp duty that would otherwise be due on second homes (FT)
Overseas investors snapped up more than half of all properties for sale in London’s most exclusive post codes in the second half of 2017, taking advantage of attractive discounts. (FT)
The top five London boroughs for new homes under construction in 2017 were, to the nearest thousand: Tower Hamlets (14,000), which includes Canary Wharf and Aldgate; Newham (8,000), which includes the Olympic Park; Greenwich (6,000), which includes the Greenwich Millenium Village; Wandsworth (5,000), which includes Nine Elms; and Southwark (5,000). (ES)
We very much hope that you find this update concise and informative. However please do let us know if you would rather we did not send this to you.