Tag Archives: crisis
Demand for office space in London remained in quiet first quarter of 2016
Demand for office space in London remained robust through the traditionally quiet first quarter of 2016 with 3.1 million square feet leased by companies, a new report shows. This was marginally below the 10 year average of 3.2 million but despite fears that economic headwinds and the possibility of the UK leaving the European Union could dampen demand, according to the analysis from global real estate advisor CBRE. The largest deal in the first quarter of the year saw Thomson Reuters acquiring 315,400 square feet in Canada Square in the Docklands, lifting overall take-up for the quarter. The data from the report also shows that the amount of office space currently under offer remains unchanged from the previous quarter at three million square feet, having been above the 10 year average of 2.8 million square feet since the beginning of 2014. It explains that the development response has so far tracked demand, with supply increasing by 2% over the course of the quarter to stand at 12.2 million square feet, some 17% below the 10 year average. ‘Between a weak outlook for global economic growth and an upcoming vote on EU membership, businesses have had to contend with a heightened level of uncertainty,’ said Emma Crawford, head of Central London Leasing at CBRE. ‘That demand for office space has remained so resilient speaks volumes for London’s ongoing attractiveness as a global hub for those companies hoping to lay down roots or expand their footprint in the capital,’ she pointed out. ‘Whilst the high level of space under offer is particularly encouraging, we anticipate a more subdued second quarter as the referendum vote gets closer. We will be on course for a rebound in leasing activity in the second half of the year provided the UK votes to remain in the EU,’ she added. Continue reading
Research reveals deposit gap between Greater London and rest of UK
The average deposit for a Greater London property is nearly three times or 170% more that of the rest of the UK, at £127,000, new research shows. Average deposit has increased by nearly £30,000 or 30% for London home movers in the last three years, the report from My Home Move also shows. However, overall, the average UK deposit size as a proportion of purchase prices has decreased by 1.8% since 2013, but home movers’ deposits remain high as house prices increase. The figures show that national the average property price in 2013 was £162,040 with a deposit of £44,690, rising to £173,202 and £45,534 in 2014 and £182,293 and 46,976 in 2015. In Greater London the average property price was £377,855 in 2013 requiring a deposit of £99,375, rising to 439,399 in 2014 with a deposit of £112,266 and £482,512 in 2015 with a deposit of £127,141. So in the UK as a whole the deposit needed in 2013 was 27.58 of the purchase price, falling to 26.29% in 2014 and then falling again to 25.77% in 2015. But in Greater London in 2013 a buyer needed an average deposit of £26.3% in 2013, falling to 25.55% in 2014 but rising again to 26.35% in 2015. ‘The London property market has always commanded greater prices than anywhere else in the UK but our research has shown just how extreme the situation is becoming,’ said Doug Crawford, chief executive officer of My Home Move. He pointed out that London property prices have risen by 27% in the last three years and while the rest of the UK has seen a small decrease in the average deposit size, those looking for a London home are depositing 170% more than their UK counterparts. ‘This situation is unsustainable and has been driven by rising house prices. For some, their deposit will come from the equity in the property they are selling. However, for many, they will still need to save tens of thousands of pounds to make the move onto and up the property ladder,’ he explained. ‘Ultimately, it still begs the question – who is going to help those looking to enter the capital’s housing market and those on the lower rungs of the ladder, first time buyers and second steppers?’ he pointed out. He also pointed out that earlier this year the firm predicted that 100,000 properties would be purchased in 2016 using gifted deposits courtesy of the Bank of Mum and Dad and based on these figures, it looks like a very large portion of these could be based in the Greater London area. Having analysed over 60,000 purchase records to determine the average deposit size paid by home buyers between 2013 and 2015, My Home Move compared these findings to the average property prices held by the Land Registry for the same period. Continue reading
The growth of London house prices has slowed down, new data suggests
London house price growth has slowed in the first quarter of 2016 and is now nearly three times lower than it was in the last quarter of 2015, new research shows. The London market recorded price growth of 1.2% in the first three months of the year while nearby regions have seen higher price growth, according to the latest UK House Market report from the Lancaster University Management School. For example, the Outer Metropolitan area has seen price growth of 3.1%, Outer South East 2.5% and East Anglia 4.1%, the data from the report shows. The report says that this is in line with the so-called ripple effect, suggesting that substantial house price increases in London over the last few years spread out to surrounding regions over time and have a leading effect on the UK housing market. It suggests that the slowing growth in the London property market has coincided with two factors, possibly working in opposite directions: an increase in the uncertainty of global economic conditions, especially in the East, and the run-up to the introduction on the 01 of April of extra 3% stamp duty on additional property purchases. The Observatory has been set up to monitor for signs of exuberance in prices in the UK regions, and releases its analysis each quarter alongside the house price data. Continue reading
