Source: The Guardian
The number of homes sold in London for £1m or more will go up by almost half by 2018 as house prices and prosperity soar in the capital, an estate agency has said. More than 11,000 homes will be sold in London for more than £1m in five years, according to Savills, with the £1m map expanding to include Crystal Palace and Isleworth in Greater London. If the forecast is correct, it would represent a jump of 47% compared with 2013, when 7,529 homes were sold for £1m or more, according to Land Registry figures.
The £1m-plus market has grown by 165% over the past five years to a background of rising wealth and a flow of foreign investment into the capital. A decade ago, just over half of sales of such properties were concentrated in the two central boroughs of Kensington and Chelsea and its neighbour Westminster. Last year that dropped to a third of £1m-plus sales, with Wandsworth, Hammersmith and Fulham, Camden, and Richmond upon Thames each reporting more than 500 sales at this price level. Lucian Cook, head of UK residential research at Savills, said the capital’s £1m property map would change again over the next five years. “In the past five years, we have seen £1m sales increasingly extend into areas such as Acton, Dalston, Herne Hill, Tooting Bec and Blackheath. In the next five years such sales are expected to become significantly more concentrated in emerging locations such as Streatham, Kingston, Borough and Northwood.
“The majority of locations where we expect to see the emergence of £1m-plus sales in the next five years neighbour existing prime areas. Areas such as Earlsfield, Brixton and Wanstead should see a greater proliferation of the £1m price tag, which is also expected to begin to appear in such locations as Crystal Palace to the south, Southgate to the north and Isleworth and Osterley to the west.”
Not all of London’s 33 boroughs are benefiting from London’s rising prosperity, with Barking & Dagenham and Newham failing to achieve any £1m-plus sales last year. Croydon, Waltham Forest and Bexley achieved fewer than 10.
Cook said much of the increase in the number of homes sold for more than £1m over the next few years would be organic, driven by underlying house price growth.
A prime London property worth £1m at the end of 2013 was worth £472,000 in 2003 and is forecast to reach £1.23m by the end of 2018. Savills’ forecasts suggest the average price of a prime London property will rise 23% in the five years to the end of 2018.
Cook said a larger supply of new-build homes would also be a driver of more £1m houses by 2018.