Despite predictions that London would see a sharp drop in property prices after the Brexit vote in the EU Referendum, large parts of the London property market remain boyant, with prices for small homes, starter homes and family homes remaining on an upward trajectory. Indeed, London remains the epicentre of the UK housing crisis and there is strong demand for new buildings at all levels of the London property market.
The latest big development at the high end of the London property market is 22 Bishopsgate. The skyscraper has just received planning permission and will become the tallest building in the City of London’s square mile.
With 12,000 workers being housed in the building, it creates further demand for accommodation in the London area and will help fuel continued growth in demand for the London property market.
A surprising new entrant into the London property market is Tesco. The multi-billion pound retail giant is planning to build pre-fabricated apartments in towers to be build on top of it’s large retail stores. The plan is supposed to breathe new life into the low end of the London property market.
The aim of the ‘mini-Tesco villages’ is to create hundreds of new low-cost or affordable homes above the Tesco stores. This would allow Tesco to increase property rent and profitability from their larger sites whilst helping to provide low-cost, prefabricated homes for people that currently cannot afford to buy their own home or even get to the top of a social housing waiting list.
Although the Tesco plan would create additional housing stock at the lower level, it is unlikely that they will be desirable or make much difference to the price of the current housing stock. The London property market has such a shortage of starter homes and affordable accommodation that demand for homes already owned by people are unlikely to be affected.
The rising cost of living in London combined with the increased amount of employment will see demand for housing continue to rise, pushing up house prices for two, three and four bedroom homes in the London property market.
For those people that own starter homes in London and are struggling to maintain a mortgage or struggling with financial difficulties, downsizing remains a tricky task due to the buoyancy of the London property market. For that reason, many choose to relocate further from the centre of London, to outer suburbs such as Barnet, Hayes or Ilford. Some are even moving further afield to commuter towns and cities such as Ashford, Croydon, Harlow, Wycombe or Reading. Additional infrastructure developments such as CrossRail are making it more financially viable to move away from London without extensive commutes back into the city for work.