London Property Prices & Market Commentary | KALMARs

Property Prices London | Market Commentary


 

Market Report July 2015

 

Market Report October 2015

 

Market Report May 2016

 

Market Report November 2016

 

Marketing Report - 2016-2017


July 2017

The market in South East London generally remains strong, with stable prices.  The  outlook for 2017 also remains strong with continuing availability of money and a shortage of offices and residential space.

Brexit continues to be a concern, but the momentum of the British economy and the long period before the restructuring is actually implemented has meant that whilst 2016 slowed it has not caused major problems to the South London property market.

INDUSTRIAL

The fall in the vacancy rate over the past few years is a direct result of the loss in commercial space across the South East of London, with industrial buildings and sites being converted into residential dwellings. For example Southwark Council have confirmed the Preferred Industrial Location (PIL) for Old Kent Road and wider area is likely to be amended in the New Southwark Plan Preferred Options, which is to be presented later this year. The plans are currently being formed by Allies and Morrison are set to include the provision of up to 20,000 new dwellings, commercial space for 10,000 new jobs and the proposed location for the new Bakerloo line extension. This has led to an increase in competition, thus reducing incentives and void periods.


PRIME SECONDARY TERTIARY
RENT £SPSF 16 12.5 8.5
SALES £SPSF 210 170 135


OFFICE

Throughout 2016, office availability across the Southbank has continued to fall; albeit at a slower rate of decline than in previous years. Whilst the rate of new development under construction has been steady since Q1 2014, the development pipeline remains small, culminating in the few new deliveries. The acute lack of supply across London's Southbank is a key contributor to the rising quoting rents which for Q4 2015 and Q1 2016 have remained in the region of £51 per sq. ft. The market has witnessed a 38% increase in quoting rents over the last three years, further dispelling any misconceptions of the Southbank as a place to secure cheap office space.

  PRIME SECONDARY TERTIARY
RENT £SPSF 90 40 25
SALES £SPSF 750 600 350


RETAIL

Appetite from retail occupiers remains strong within what would have previously been considered fringe markets such as Peckham, with well known retailers competing for accommodation in the area. We predict this will continue whilst the housing market in South London remains strong.



PRIME SECONDARY TERTIARY
RENT £SPSF 80 - 100 25 - 35 15
SALES £SPSF 1,500 - 1,800 450-500 220-240


DEVELOPMENT

Development for sites in South London remains very strong. A recent advert we had in the Estates Gazette produced a record number of enquirers and a 0.9 acre site received around 50 offers when tendered. Coupled with an acute shortage of sites for residential development, this is continuing to push land prices. Funding also remains readily available from both banks and private investors. These strengths are in spite of concerns over the outcomes of Brexit and the widely reported potential oversupply in areas like Vauxhall, where high prices are likely to require correction. Changes in the buy to let mortgage interest relief and Stamp Duty have reduced high value residential sales especially for investors.

 

RESIDENTIAL

The value in pounds per square foot has not changed significantly over the last few months with the exception of SE16 (Rotherhithe and Canada Water), which has grown from the £850 to £950 psf. The highest values are not surprisingly in the central areas of SE11 and Battersea plus the affluent area of Wimbledon. The inner South East and West is in the midrange whilst the South Eastern fringe is more affordable.
 

RESIDENTIAL LETTINGS

During the last few months the residential lettings market has calmed from the frenetic heat of the last few years, the main area of activity now being lower end of the market, which is still active and properties let quickly.


RENT £PW
BEDS PRIME SECONDARY
1 450 350
2 575 450
3 650 550


RESIDENTIAL SALES

Fundamentally there is still a mismatch between demand and supply and the shortage remains a problem for inner London. However in the short term, various factors have combined to slow the sales market including increases in Stamp Duty, reduction in the benefit to investors and uncertainty over Brexit.

  SALES £PER FLAT
BEDS PRIME SECONDARY
1 700,000 400,000
2 850,000 600,000
3 1,050,000 700,000

For further information about the above please contact the following:

Development: Donald Walsh
Industrial: Piers Hanifan
Retail: Anthony Tappy-Day
Offices: Adrian Gurney
Residential: Sebastian Kalmar

Important Notice: These details are believed to be correct, but we cannot accept any liability whatsoever for any misrepresentation made either in these particulars or orally. All interested parties are therefore advised to make their own enquiries to check these particulars prior to placing any financial or other reliance on this information.

About Kalmars

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