Docklands News

The London property market is overvalued by as much as 50%, analysts have warned, prompting fears of an impending correction. S&P Global, part of Standard & Poor's, used long-term average prices of properties and compared them with income data for its calculations. Alastair Bigley, a researcher for the agency, warned that prices were likely to fall. “A combination of low rates, the stamp duty holiday and excess savings amid the pandemic have driven property prices higher, particularly in London and the South East where overvaluation relative to income over the long-term is as much as 50%,” he said. “We expect a greater correction in property prices in an overvalued market.” Outside the capital, S&P estimated that property was overvalued by 20%. Mr Bigley said that house price rises were “a consistent trend” across the pandemic, which was not initially noticed due to the disruption to the international economy. 

The Daily Telegraph (21/03/2022)  

UK house prices hit an average of £274,000 in January – an increase of £24,000 compared to the year before. Average house prices increased 9.6% over the year to January, a dip from 10% in December 2021, according to the latest official statistics. London saw the lowest annual growth at 2.2%, the Office for National Statistics house price index revealed.  “We are continuing to see strong annual growth in house prices across the UK, with the biggest rises seen in Wales, while London continues to be relatively sluggish", said ONS house prices statistician Ceri Lewis. “UK rental prices also continue to rise at a rapid pace, with their highest annual growth in over five years".

The Daily Telegraph (23/03/2022)   The Times (23/03/2022)  

Alexandra Goss in the Times looks at the property market, highlighting Nationwide data showing that annual house price growth rose to 12.6% last month and the average price has gone above £260,000 for the first time. Propertymark figures show 39% of properties sold for above the asking price in February, while analysis by Savills suggests the number of sales agreed in the first two weeks of March was 20% above pre-pandemic levels while the number of properties coming to market was 8% below. However, Capital Economics’ Andrew Wishart expects interest rates to hit 2% next year, warning that the average rate on new mortgages is set to double from a low of 1.5% in November 2021 to almost 3% in 2023. This, he suggests, is likely to cause demand and price growth to “slow to a crawl.” Gráinne Gilmore, head of research at Zoopla, forecasts average price growth of between 2% and 4% by the end of the year, with fewer transactions. 

The Times (18/03/2022)  

Property transactions reached 96,250 in February, with higher value buying at pre-pandemic levels. Transactions were up 15% last month, compared to 83,450 in January, according to HMRC’s latest data. Total sales for the first two months of the year stand at 179,900, some 18% lower than last year. However, this is still the next highest level since 2007. According to data from TwentyCi, sales for properties worth £300,000-£500,000 were 47% higher than pre-pandemic levels. For properties between £500,000 and £1m, there were 73% more sales than before the pandemic. 

City AM (22/03/2022)  

Buyers save around £1,400 a year compared to renters, mortgage data has shown. Buyers save £115 a month on average on housing costs if they can afford to get on the property ladder, Halifax data suggests. The bank compared the typical monthly rent for a three-bedroom property in Britain with average buying costs, which include mortgage payments, household maintenance, repairs, minor alterations, insurance and income "lost" from funding a deposit instead of saving. Average buy-to-let monthly rents increased by 6% to £874 between December 2020 and December last year, while buying costs rose 2% to £759 a month. Esther Dijkstra, mortgages director at Halifax, said: "Over the last year we have seen record numbers of buyers entering the market, moving to bigger properties and taking advantage of the stamp duty holiday. However, historic lows for interest rates have kept mortgage costs down, compared to rents."

The Times (19/03/2022)  

Morris+Company has added a second set of stairs to a proposed 52-storey tower in Canary Wharf after the London Fire Brigade (LFB) raised safety concerns over the original design. Developer Ballymore's planning application for the 424-home tower was due to ruled over by Tower Hamlets Council in January; however, it was withdrawn following the LFB's comments that the single-staircase design did not provide a ‘suitable and convenient means of escape’ in the case of a blaze. The updated plan replaces a lift in the building’s southern core with a new stairway that can be accessed from every floor. The changes, which do not affect the number of homes or the building’s façade, mean there will be one fewer lift for the building. However, a planning statement said the other three lifts had been "increased in size and will operate at a faster speed to meet waiting time requirements". Morris+Company's 174m-tall tower is earmarked, alongside a pocket park, for a 0.44ha site running along Cuba Street. The castle-inspired scheme is now due to be ruled on by Tower Hamlets' Strategic Development Committee in the coming months.

Architects' Journal (15/03/2022)   My London (15/03/2022)