According to new research, residential property prices in East London are, “helping to shore up a slowdown in other parts of the capital hit by uncertainty in the market.” The recent report reveals that sale prices of residential properties in London rose by almost 2% in the year to March, but the rate of that growth varied considerably in different parts of the city.
In the Central West area of London prices dropped by 5.3%, and in the West End by 2.9%. In East London conversely, in areas around Stratford, prices rose by 7%.
“These figures clearly show the attractiveness of residential property in East London at the moment, and the strength of its proposition as an investment,” commented Joel Brookes. “As people look outside of Central London for better deals, the revitalised East is particularly attractive, and the future completion of Crossrail is set to deliver a considerable boost to its connectivity.”
With developers keen to capitalise on East London’s newfound popularity, the properties available to buyers are also increasing in desirability. The Scholars Court development in Bow which Vanet is currently offering for sale for instance offers a selection of spacious 1- and 2-bedroom new build apartments with balconies and terraces. With private communal gardens and prices under £600,000, developments such as these are an attractive proposition at a more affordable cost than Central London. But just as importantly, with prices steadily increasing in East London, they are a sensible investment for the future.
One of the most significant political factors that could affect the London property market over the coming years is the London mayoral elections on 5th May. With the election ostensibly a two-horse race between Conservative candidate Zac Goldsmith and Labour’s Sadiq Khan, the expected actions of these two front-runners are of prime importance.
Last month, we looked at Conservative candidate Zac Goldsmith’s plans to increase the number of ‘build to rent’ homes. Both candidates have said in their manifestos that they will address London’s housing crisis, but as is to be expected, the nature of this differs somewhat.
Sadiq Khan on London housing
Sadiq Khan’s election campaign has been based partly on a platform of ‘homes for Londoners’, and his website states that he will, “deliver more affordable homes [with] ‘first dibs’ on those homes for Londoners, and action on rents.” He has also said that he will set up a team dedicated to, “fast-tracking the building of genuinely affordable homes to rent and buy,” and has set a target for 50% of all new London home to be ‘genuinely affordable’.
Zac Goldsmith on London housing
Zac Goldsmith meanwhile has said that he will, “double home building to 50,000 a year by 2020,” “give Londoners the first chance to buy new homes,” and will “ensure a significant proportion of all new homes are only for rent and not for sale.” Another key pledge is to ‘amend the London Plan’ to ensure house-builders build faster. Goldsmith also announced recently that he intends to appoint a ‘Chief Architect for London’, who will oversee his manifesto pledge to build 50,000 additional homes a year.
Vanet’s Director Joel Brookes commented ahead of the election, “Both candidates talk substantially about housing in their manifestos, and this is clearly one of the key subjects of our time. We should however be wary of accepting what is published in the manifestos as a cast-iron blueprint of what will happen, as this is subject to change post-election.” “Whichever candidate wins, their future actions, rather than their words, may affect the London property market to some degree.”
London home owners confident of property values ahead of referendum
Soon after the London elections comes another major political event that could have a substantial effect on property prices in the capital in the long-term – the EU referendum. There is of course no way of knowing specifically how a so-called ‘Brexit’ might affect property prices in the future, with this closely entwined with the performance of the UK economy in the wake of such a decision.
In the face of this uncertainty though, London property owners appear to be confident that their homes and investments will retain their value whatever the outcome. A survey by Zoopla found that 94% of London home owners expect their property to continue to increase in value over the next six months.
Joel Brookes commented that, “London property is so desirable at the moment for both those who live and work in the area and for overseas investors, that there’s a lot of confidence in the market that it will resist any other external influences.”
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