As we have covered in previous monthly reviews, the London property market is currently in rude health, with the values of properties in the capital continuing to increase. This month, figures from the Office of National Statistics (ONS) revealed the full extent of this.
The figures reveal that in January, average London house prices increased by almost £500 a day. According to the Guardian, the data also, “reveals that while London and the south-east are powering ahead with double-digit annual growth rates, the property markets in Wales, Scotland and Northern Ireland appear to have stuttered to a halt.”
The ONS statistics reveal that average London house prices in January reached a record high of £551,000 in January – an increase of £15,000 on the previous month.
Vanet’s director, Joel Brookes, comments that, “These figures reaffirm London’s special status in the overall UK property market. With so much foreign property investment here, the natural pull of the capital’s many jobs and opportunities, and the lucrativeness of the buy to let market, it’s hardly surprising that property prices here are speeding ahead of the rest of the country.”
Buyers anticipate big things along Crossrail route
With three years to go until Crossrail services begin operating, canny investors are buying property along the route, which runs from Southall in the west, through Liverpool Street, Whitechapel, Stratford and Canary wharf in the East and beyond. According to a recent article by the Telegraph, property prices in areas along the new train line are 16% higher than the average for Greater London, and 7% higher than properties located near stations that will not be served by Crossrail.
“Londoners, and property investors are understandably excited by the prospect of Crossrail,” comments Joel Brookes. “With travel being such an issue for people living and working in London, many of whom face long and crowded commutes currently, the benefits of living close to a station served by the new high-speed service are clear.
“In the coming years we are likely to continue to see increases in property prices along the route, in areas such as East London, where numerous stations such as Farringdon, Whitechapel, Canary Wharf, Custom House and Woolwich are all included in the new network.”
Crossrail is set to begin operating in 2018, with full service along the route by 2019.
East London alive with new property developments
East London is currently a hotbed for property development, with substantial developments taking place in many areas, from Silvertown, where thousands of new homes are being built, to the numerous apartment developments and whole districts under construction on the Greenwich Peninsula.
Express Property’s Deborah Stone recently published a roundup of some of the key developments taking shape in East London, noting that, “The old docks may be long gone and local families dispersed, but life is finally returning to some of the most historic yet least lovely parts of East London.”
Vanet’s head of sales and lettings, Paul Bartolo has meanwhile commented that, “with space and housing at a premium in London, we’re seeing a lot of movement in the transformation of areas which have formerly fallen out of favour. East London in particular is undergoing a massive period of change, and over the coming decade we’re going to see considerable redevelopments similar to those sparked in and around Stratford before and after London 2012.”
Developer clams luxury housing slowdown over stamp duty
According to housebuilder Berkeley, recent increases to stamp duty on homes valued at more than £937,500 and those bought as second homes, have had a substantial impact upon the luxury housing market in London. As reported in the Guardian, the property developer has said that it has experienced reservation rates for new homes between November and February which are 4% lower than the same period the previous year.
The developer has warned that this could result in slower growth in the luxury London property market. However, it seems likely that this growth will be re-channelled into more affordable London housing that is less impacted by the stamp duty changes.
Goldsmith aims to enhance London ‘build to rent’ market
Finally, with the issue of London property a hot topic in the run up to the capital’s mayoral elections, conservative candidate Zac Goldsmith has revealed plans to increase the number of ‘build to rent’ homes.
Goldsmith has said that he will make the planning system and viability process more accommodating to purpose built rental developments. He also said that if he were mayor, ‘a significant proportion’ of new housing on public sector land would be for private rent.