House prices in the capital are detached by location
London’s property market is outperforming but some boroughs are well off the pace
LONDON
Neither London, nor England and Wales, have returned to their 2008 peaks – but London is close. From March 2009, prices have grown 16 per cent in London compared to 6 per cent in England and Wales as a whole. However, looking at London as a single housing market can be misleading. Peter Rollings, chief executive of Marsh & Parsons explains “London is not one single housing market, but a collection of mini-markets which vary immensely across the capital.” Very local factors – such as schools and transport links – influence prices. But the biggest driver of differences has been international. Liam Bailey, Knight Frank’s global head of residential research says “the reality is only central London has seen the influx of foreign money and flight capital which has acted to push prices much higher.”
KENSINGTON AND CHELSEA
Kensington and Chelsea is well up on its previous peak and has risen 38 per cent from March 2009 outstripping the growth of other London boroughs. Andy Buchanan, director of John D Wood & Co has been an estate agent in the Chelsea market since 1971 and seen this resilient market perform reliably, often counter to misleading data: “We have found during harder times the property market is underpinned by a lack of committed sellers, resulting in supply shrinking as demand reduces, thus maintaining prices.”
SOUTHWARK
On average, property prices in Southwark are up from their 2008 peak and are up 16 per cent since March 2009. The borough benefits from great transport connections and the arrival of the Shard has put it firmly on the map, says Alex Dolley, manager of Greene & Co’s City office. “The commuter links and the regeneration of the area have lead to City professionals between 25 and 40, who would traditionally look to buy their first property in north London, to consider Southwark as a viable and attractive alternative.”
WANDSWORTH
On average, Wandsworth is just up on its 2008 previous peak and 21 per cent up on from March 2009. Neil Chegwidden, director of research at Jones Lang LaSalle is bullish about its prospects: “The Nine Elms regeneration is arguably the most exciting regeneration and development area in London.” He thinks “with the new US Embassy the centrepiece, significant residential development will be complemented by increased retail and leisure provision to provide a vibrant and exciting new hub for London.”
CAMDEN
Average house prices in Camden are up on their 2008 peak and have risen 28 per cent since March 2009. Matt Stanway, manager at Urban Spaces says he “doesn’t see this growth contracting in the near future.” He thinks “the wide range of properties – from new developments to interesting canal-side and semi industrial developments – along with the excellent commuter links, shops and restaurants” will continue to make Camden an increasingly popular option for first time buyers.
BARKING AND DAGENHAM
Many parts of London haven’t recovered from the dip. For example, average prices in Barking & Dagenham are up just 1 per cent from March 2008. Peter Rollings, chief executive of Marsh & Parsons notes that compared with central prime areas, “the borough of Barking and Dagenham has seen far fewer cash buyers, and is much more exposed to the adverse headwinds in the mortgage market affecting the rest of the country, holding back first-time buyers numbers and undermining prices.”
WESTMINSTER
Westminster is 17 per cent up on its 2008 peak, rising 35 per cent since March 2009. The supply of housing may open up slightly in this highly sought-after area. Neil Chegwidden, director of research at Jones Lang LaSalle says “several significant, high profile and high-end residential developments could get started in Westminster over the next few years, including St John’s Wood Barracks, Chelsea Barracks and Arundel Great Court.”
GREENWICH
Greenwich hasn’t rebounded entirely from its 2008 peak, rising 8 per cent since March 2009 – half the rate of London’s average. However, Neil Chegwidden, director of research at Jones Lang LaSalle notes “Greenwich is set to see significant development over the next few years.” He thinks the river is key, “with residential development reaping the benefits which accompany a riverside location.” Chegwidden says “pricing will be more affordable relative to more central and western locations so demand from young professionals should be high. Lovells Wharf, Greenwich Peninsula and Paynes and Borthwick are key schemes.”