The Tory leadership contest continues to dominate the UK political landscape and this in turn means that the housing market remains in the doldrums until a leader is chosen and the Brexit plan becomes clearer.
The good news though is that demand is picking up and the London sales market is certainly stronger than it was a couple of years ago. As we move into the summer we are seeing greater movement in the market, with more offers coming in from potential buyers. Property owners keen to move are adjusting their prices in order to remain competitive and encourage offers so there are quite a few good deals to be had at the moment. And, with many discounts available from developers, arguably this couldn’t be a better time to buy.
And while many professional investors continue to sit on their laurels, recognising that their biggest advantage – the weakness of sterling – is unlikely to change any time soon, it is first time buyers that are driving forward the current increase in activity in the sales market.
These first-time buyers realise they cannot wait for a Brexit deal to be finalised and that the current situation may offer the best opportunity they will ever have to take that first step onto the housing ladder. Mortgage interest rates remain at a historic low, Help to Buy continues to offer significant financial benefits and weak house price growth means that the market is probably near the bottom of its current cycle.
Of course, affordability remains a key issue amongst first-time buyers in particular, as does the ability to raise enough money for the required mortgage deposit. Homes in Zone 1 are beyond the budget of all but the most affluent, but in Zone 2 outwards there are new developments in popular areas where buyers are able to find affordable homes.
One of these areas is Hayes Village, a new development from Barratt London which eventually will comprise 1300 homes on the site of the former Nestle factory in Hayes. Situated at the heart of major regeneration in the area, the development is a 10 minute walk from Hayes and Harlington Crossrail station which will take commuters to Bond Street in 20 minutes. New homes will start to complete in summer 2020.
Boris Johnson currently seems to be the front runner in the Conservative leadership contest but what influence could he have on the housing market if he does become Prime Minister?
We examined Boris’ time as Mayor of London and looked at house price growth in the capital during his tenure. Over his two terms, house price growth in London grew by 58.4%, 43.9% higher than the UK as a whole. Four separate boroughs gained notable deprivation improvements – with house prices in two of these, Hackney and Haringey, outperforming the London average with an increase of 59% and 64.5% respectively, while price growth exceeded 40% in Tower Hamlets and 53.6% in Newham.
Investment in Lambeth via regeneration projects such as Loughborough Junction, Southwark via the Elephant and Castle project, Wandsworth via the Battersea Arts Centre and hew homes in Islington, also seemed to help these boroughs achieve price growth above the London average during his two terms.
Of course, this is just a snapshot of some of Boris’ housing-related achievements to date but it may illustrate his attitude to investment in housing and the regeneration of previously deprived areas, all of which bring many benefits, not least an uplift in the local housing market.
If you are planning to buy or sell a property soon, call our sales office on 020 3280 6400.
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