West Hampstead Life

Category: Property News

  • Property News: Rental round-up

    Property News: Rental round-up

    In January we conducted our first tenant survey, and discovered that 66% of tenants would prefer to rent through a letting agent than through a landlord directly. We thought it would be interesting to know what factors influence applicants when choosing agents to register with, so please select as many options from the poll that are applicable and we’ll let you know the results next month.

    [yop_poll id=”3″]

    Rental stock
    Earlier this year we discussed how West Hampstead rents were suppressed due to reduced budgets and rising stock levels, as well as the surge in the residential sales market. Now in August we’ve seen the usual summer swelling of the applicant pool, which coupled with the current attractive rent levels has led to unprecedented demand for local stock.

    Although demand is strong, we don’t expect a surge in rent prices anytime soon; rent rises will continue to be relatively modest as we progress towards autumn. This is because despite demand being strong, the market is still price and especially product sensitive.

    Finance
    On the mortgage front we’ve spoken to our landlords recently and discovered many are looking to change products. There’s a desire to move from current buy-to-let SVR’s to five-year fixed buy-to-let products, predominantly because rates are attractive and they want to lock rates in while they can in case interest rates increase.

    Yields
    One reader asked what the impact of a sudden boom of new flats in the area would be on rental prices/yields. As it stands I don’t expect there to be much of an impact as demand for property in the area is so strong. Yields are cyclical and even if they were to drop it wouldn’t disrupt the market. Buy-to-let in London is currently a self-regulating investment; when capital appreciation stagnates yields increase, and vice versa. Yield is a long-term investment vehicle and the only thing that will impact it is the price of purchase.

    Rents
    The HomeLet Property Rental Index highlights that average rental values in London were 9.4% higher in July 2014 when compared to last year, when average rents were £1,295pcm. Their North West London figures show that average rents in July 2014 are £1,739pcm, a rise of 11.3% on the average rent of £1,562pcm from July 2013.

    Housing bubble
    On a final note, John Mennis recently asked on Twitter what a “bubble” was. We did a little research and we can trace the first use of the word “bubble” in a market contenxt to the early 18th century, when it was used to describe what happens when ‘the price of assets temporarily rise above true values, only to burst and cause a sudden decline’. Before “bubble” became part of the discourse, “mania” was used to describe the same economic effect.

    You’re not alone with your criticism of the word John; Peter Garder describes the word “bubble” as a ‘fuzzy word filled with import but lacking a solid definition’ in his book Famous First Bubbles: The Fundamentals of Early Manias. And that’s your history lesson over for the month!

    Spencer Lawrence
    Lettings Director
    Paramount Properties
    150 West End Lane
    West Hampstead
    020 7644 2314

    request a lettings valuation

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  • West Hampstead’s housing bubble: Deflating not bursting

    West Hampstead’s housing bubble: Deflating not bursting

    If the bubble were a balloon then it hasn’t so much burst as been untied and blown around the room deflating and losing all forward momentum and energy over the last few weeks.

    All of the industry heavy-weights and recent press coverage are reporting falls in asking prices and buyer demand across London; West Hampstead is no different. Rightmove has reported asking prices in London now at a virtual standstill for June and July, although it says prices are up 14% year on year. Sequence reports a month on month fall in June of 14% for new applicants whilst a Hometrack survey of Estate Agents in July tells us that house price growth in London has slowed ‘dramatically’ and is the weakest in 18 months with agents finding it “hard to push prices in the face of weakened demand”.

    The Hometrack findings seem alarmist and in my opinion, simply mark the end to ‘open day frenzy’, ghost gazumping (being forced to raise your offer due to the increasing market alone) and ‘sealed bids’, which is no bad thing. It feels like the market has stopped off at the service station whilst affordability and common sense catch up.

    There is no doubt however that demand has fallen significantly over the last 2 months and the question most buyers and sellers are now asking themselves is whether this is a seasonal blip or a longer term trend. The reasons for the slowdown in demand have been well documented and speculated about over the last few months; stricter lending affordability stress testing for mortgage applications introduced from the MMR, the spectre and inevitability of rising interest rates, the strong pound making London property less attractive to overseas buyers, next years’ election getting closer, press speculation over the ‘London bubble’ and strategic rhetoric from Mark Carney. All of these factors have combined to alter buyer sentiment to a ‘wait and see’ view rather than the bun fight that epitomised recent months.

    There is, however, one overriding factor driving the London market and that is the supply of property and land compared to the increasing population and long-term demand, which must mean that prices will continue to rise over the long term although hopefully in a more controlled and steady way. We are anticipating a quiet summer with little or no growth in asking prices followed by a return to a more normal market in September.

    In an earlier Property News this year I wondered what tools Mr Carney had available to him other than interest rates to control the UK housing market. We now have our answer and they have been very effective and imaginative tools. If we have successfully avoided the ‘boom and bust’ of previous attempts it looks like the UK housing market could be in very good hands. All we need now is to sort out the planning system.

    On a separate note, I noticed that soon after the last Property News ‘Build high or fiddle while Rome burns’ Camden Council has announced plans for a 14-storey tower block at the Liddell Road site. I was surprised at the amount of objection to this proposal. A much needed development that provides a school and one- and two-bed flats close to transport links at no cost to the taxpayer seems like a good idea for West Hampstead. Surely, it is only with the increase in supply of new homes that we can hope to make London affordable for future generations of key workers? Light industrial sites close to railways make ideal sites to build high with the least impact on surrounding conservation areas or green belt land further out.

    Darryl Jenkins
    Associate Director
    Benham & Reeves
    West Hampstead
    020 7644 9300
    Follow @BenhamReeves

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  • How affordable is “affordable housing”?

    How affordable is “affordable housing”?

    Providing affordable housing is becoming a hot topic in West Hampstead. This article first appeared as part of a longer piece on 156 West End Lane, but we thought it would be helpful to split it out. Exact definitions of affordable housing are more or less impossible – they simply don’t exist, that’s not how affordable housing works for obvious reasons (lots of people working in London could afford property elsewhere, for example). What follows is an attempt to clarify the term in the context of London and Camden and there’s some links to further reading.

    What’s “affordable”?

    Affordable housing should:

    • meet the needs of households whose needs are not met by the market and who are eligible for affordable housing, and
    • be provided at a cost they can afford, taking into account local household incomes and market housing costs, and
    • be affordable to future households unless arrangements are in place for subsidies to be recycled into alternative affordable housing provision.

    Three types of affordable housing

    Social rented housing is primarily housing managed by local councils and housing associations. The cost of social rented housing is controlled by a national rent regime. Other affordable housing providers may manage social rented housing under the same rental arrangements. This is what most people think of as “council housing”.

    Intermediate affordable housing costs more than social housing but less than equivalent market housing. Camden controls the cost of intermediate affordable housing taking into account market costs and the eligible income groups. The Mayor’s February 2011 review indicated that eligible households were those with incomes of less than £64,000 per year (gross). The draft replacement London Plan indicates that he intends to raise the eligible income to £74,000 per year for intermediate affordable homes with 2-bedrooms or more.

    How does income covert into housing costs? At the moment, in London, intermediate affordable housing should cost no more than 3.5x the household income threshold to buy and no more than 40% of net household income including rent and service charges.

    Most intermediate affordable housing in Camden has been provided by housing associations. Intermediate affordable housing can include a range of tenures such as: rented housing, shared-ownership housing (where occupiers buy a share and rent the remainder) and low cost homes for sale.

    Affordable rented housing means rents up to 80% of market levels, although the individual housing associations that manage this sort of affordable housing set their levels. Clearly, 80% of market levels is still far too high for many people. The Valuation Office’s October 2013 data put the average monthly rent of a 3-bed house in Camden at £2,976, 80% of which would be £2,380 – well beyond the reach of many.

    Affordable rent was introduced as the grant available for affordable housing development for 2011-15 was halved from its previous level. It allows social housing providers charge up to 80% of market levels, and use the increased rental income to support additional borrowing to compensate for reduced grant.

    Housing associations operating in areas with high land and market rental values such as West Hampstead will often have to manage affordable housing developed as part of private developments rather than developing their own – as is happening at West Hampstead Square, for example.

    The associations have to cover their costs, so in expensive areas, they may be forced to charge the maximum 80% level, even though that is still a high absolute amount.

    What does it mean on the ground?

    Camden has changed its affordable housing quota recently. It used to be 50% of floorspace in any development of more than 10 units had to be “affordable housing”. It’s now moved to a sliding scale so 50% of any development of more than 50 units must be affordable, 40% of developments of more than 40 units, and so on.

    In terms of the split between the various types of affordable housing, this has changed to 60% social rented and 40% intermediate housing, down from 70/30. This is, says Camden, because it believes that just over half of Camden residents in need of affordable housing could afford intermediate housing.

    Further reading

    No-one would pretend this was a simple topic to understand, and with national, city and borough policies to take into account, it’s impossible to say “affordable housing = x thousand pounds”.

    If you want to delve into more detail, then I suggest
    Camden Housing Strategy 2011-16 , which is the most accessible document and sets out more of the context.
    Camden’s Planning Guidance goes into more detail
    The 2011 London Plan on housing explains the Mayor’s position
    Camden Core Strategy CS6 (Housing) is the official policy document

  • Property News: Rental Standard gives tenants confidence

    Property News: Rental Standard gives tenants confidence

    Boris Johnson has recently launched London’s first rental standard, a ‘city-wide badge of accreditation’, to help Londoners rent with confidence and ensure landlords are complying with the law.

    We’ve known for a long time that tenants in London want to rent property through an accredited Lettings agency (in our 2014 tenant survey 80% of respondents said they would rent only through an accredited agency) but with several industry bodies in operation there’s a need for a unified body.

    The London Rental Standard will automatically allow members of the Association of Residential Letting Agents (ARLA), National Approved Lettings Scheme (NALS), Royal Institution of Chartered Surveyors (RICS) and UK Association of Letting Agents (UKALA) to receive their badge. By bringing together several landlord accreditation schemes, one badge will be awarded to all letting agents and landlords who meet the London Rental Standards, making it easier for tenants to identify transparent agents.

    We often hear that London is a market in itself and this is true for lettings as well as sales. Currently more than 25% of London’s households live in rented properties, and that’s expected to increase to 40% over the next ten years. With that in mind, anything that makes renting in the capital safer has to be a step in the right direction.

    By signing up to the London Rental Standard, lettings agents and landlords will agree to meet some ‘significant core commitments’, including transparent fees, better property conditions, better communication between landlords and tenants, improved response times for repairs and maintenance, and protected deposits.

    In numbers
    40% – expected London households living in rented homes by the mid-2020s
    85% – landlords unaware of the core legislation that protects renters
    61% – landlords with no professional management training
    100,000 – target of London Rental Standard accredited letting agents and landlord by 2016

    I think the London Rental Standard can only be seen as a real positive, and it’s a step towards regulating the entire lettings market. However there are a few unanswered questions that I’d like to see addressed, including what will happen to agencies that don’t comply. I’m also conscious that the London Rental Standard needs to raise awareness by continually pushing it in the press, so more consumers are aware of what they are doing.

    Paramount is celebrating 25 years in West Hampstead this week, so I’ve been thinking a lot about the state of the lettings market when I joined the company in 1998. Back then there were no deposit schemes or EPCs, and rules and regulations weren’t the same as they are now. Lettings has come a long way and smartened its act up, and perhaps in a few years time a London Rental Standard accreditation will be as mandatory as a Gas Safety Certificate.

    Spencer Lawrence
    Lettings Director
    Paramount Properties
    150 West End Lane
    West Hampstead
    020 7644 2314

    request a lettings valuation

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  • Build high or fiddle while Rome burns?

    Build high or fiddle while Rome burns?

    In my last Property News article I extolled the virtues of a rising London property market and the benefits to the economy of foreign investment via the ‘multiplier effect’. Some of you may be surprised to learn that I’m not a capitalist at heart, but I suppose I was just getting fed up with all of the constant talk of housing bubbles and ‘where will it all end?’. It was more a case of: there’s very little any of us can to do change it, so it may be better to embrace the positive aspects of it. But is that true and what might be the long term consequences?

    Clearly, opinion will be divided based on whether you are a property owner or not. But don’t we all have a responsibility to future generations to consider the very serious situation that London and the UK finds itself in? The harsh reality is that we are not building enough homes to satisfy the ever increasing population. A mixture of red tape planning bureaucracy and policy, NIMBYism and economic conditions mean that we have very little hope of making this any better without serious reform and a change of policy and attitude.

    The Barker review highlighted the severity of the situation back in 2004, and the Department for Communities and Local Government now estimates that we need to build 232,000 new homes in the UK every year between now and 2033. At the moment, only 120,000 homes are being built each year. The Greater London Authority’s 2012 Round Projections of population growth for London shows an increase of 2 million residents between now and 2034. This doesn’t account for the changing way in which we now live; more single person dwellings or for our longer life expectancy.

    The numbers don’t add up and it really cannot be any surprise that we have double digit growth in the London property market. What is more concerning is that we don’t seem to have any policies that are directly addressing this problem.

    The last Labour government’s response to the Barker report was to introduce a regional level of planning under which each region had to file its own plan outlining policy for development within its region. By the time the coalition government came to power, very few of these regional plans had been filed and approved and the new government decided that these only created more red tape and that the answer to our planning problems was to decentralise planning policy by empowering local communities and increasing permitted development rights.

    The grand plan is to let local residents decide on what’s best for the area and to free up buildings and sites for development by removing red tape. The regional tiers were promptly abolished and the Localism Act became law in 2011.

    Nick Clegg declared that the Localism Act was “a move from big government to Big Society”. He went on to say “It marks the beginning of a power shift away from central government to the people, families and communities of Britain”. Great sound bites at a time when trust in government was at such a low point.

    The Localism Act allows for the creation of Neighbourhood Development Forums (NDFs) which can formulate a Neighbourhood Development Plan (NDPs) outlining policy for the designated area and identifying sites for development. The potential problem with such plans is that they must be approved by the local authority and also comply with the local authority’s planning policy and the National Planning Policy Framework (NPPF). In London, they also have to comply with the London Plan.

    It seems to me that actually nothing is being decentralised, as all plans have to comply with central policy to be approved. In fact, West Hampstead’s NDP, which was one of the first, is still awaiting final approval from Camden.

    Another worrying aspect of these plans is that they cannot actually veto any planning decisions, but they do present another layer of statutory planning guidelines that developers must adhere to and that objectors can cite in any attempts to delay or block proposals.

    There will also be a concern in some areas that NDFs may not be representative of the whole community, although local authorities do require evidence that significant efforts have been made to address this before granting approval.

    Preservation of the look and feel of our area is also a concern for those living within it. The rows of Victorian terraced houses in West Hampstead and the red brick properties and mansion blocks of South Hampstead are prized and protected assets of our area. But how can we balance the preservation of such areas with the need for building more homes? The Camden plan for West Hampstead says it “expects development in the growth areas to be predominantly housing and seeks to encourage high density development”. By contrast, the local NDP states

    Recent development in the past decade has raised a number of concerns, particularly as the population of the area grows, more new homes are built and the population density of the area increases. For many residents the height of new buildings is a key issue. In an area largely made up of houses and buildings between 2 and 5 storeys high, new developments of six storeys or higher are likely to cause strong objections.

    Such opposing views must be commonplace across most of London and highlight the difficulty of building enough new homes to satisfy demand whilst preserving the local environment and feel of a community.

    West Hampstead has six potential sites identified for redevelopment and arguments over the height and size are likely to be ongoing with planners and the NDF for some time.

    It is surely inevitable that we will have to give up on these principles of preserving the height of buildings in London. Sci-fi movies show a vision of future cities with buildings reaching into the clouds with a mix of social and private housing. If we want to provide future generations with affordable housing in London whilst protecting our countryside should we not be considering constructing these buildings now? Such projects would also ease the burden on transport infrastructure and improve the quality of life of key workers forced to move increasingly further out due to increased property prices. Other cities in the world have already accepted the inevitability of this.

    The key objective of the NPPF is to achieve sustainable development. Sustainability means building that would not be detrimental to future generations. Isn’t it time we developed our planning policies to cope with these future demands rather than fiddling while Rome burns?

    Darryl Jenkins
    Associate Director
    Benham & Reeves
    West Hampstead
    020 7644 9300
    Follow @BenhamReeves

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  • Authors recognised as Ballymore apartment blocks named

    Authors recognised as Ballymore apartment blocks named

    It’s been a long time coming, but Ballymore has finally announced the names of its tower blocks, following the competition West Hampstead Life ran back in August.

    Only the first five blocks have been named so far and Ballymore hasn’t decided which name will go with which block. I’m told that the two rear blocks (which contain the affordable housing component of the development) will be named in line with the others though they’re still deciding on those names.

    Ballymore has chosen authors with local connections as the theme, and the winner of the competition is Ed Fordham, who suggested three of the five names and was, coincidentally, also one of the original agitators for the names to be chosen in this way. All submissions were sent to Ballymore anonymously however.

    The first five blocks will be called Hardy, Orwell, Beckford, Lessing and Milne.

    All five authors lived at one time or another (and for varying lengths of time!) in West Hampstead.

    Here come the boys... (Hardy, Orwell, Beckford, Milne)
    Here come the boys… (Hardy, Orwell, Beckford, Milne)

    And here’s the Nobel prize-winning Doris Lessing in 1975. Lessing died in November last year having lived in West Hampstead for some 25 years.

    More than 50 people submitted offical suggestions for the seven blocks with varying degrees of seriousness. More people left comments on the original article (including one who got most of the names that won). I won’t list all the entries, but here are a selection of the thoughtful, amusing and cheeky.

    Classical references were popular: Seven wonders of the world, seven against Thebes (niche), and the seven hills of Rome.

    Ephesus Adrastus Aventine
    Giza Amphiaraus Capitoline
    Alexandria Capaneus Esquiline
    Babylon Hippomedon Quirinal
    Halicarnassus Parthenopeus Palatine
    Rhodes Polynices Caelian
    Olympus Tydeus Viminal

    The developers had said that “Connections” was their keyword in marketing, and some played on the transport links both at home and abroad

    Marylebone Marais Paris
    St Pancras Vendome Toulouse
    Fenchurch Concorde Lyon
    Kings Cross Vosges Marseille
    Euston Bastille Strasbourg
    Paddington Madeleine Avignon
    Waterloo Châtelet Grenoble

    Famous people loomed large, many living, some dead. Lots of submissions covered broadly similar ground with Dusty Springfield, Gerry Anderson, Emma Thompson, and Dirk Bogarde all featuring prominently. Camila Batmanghelidjh always seemed like a stretch though.

    No-one would be surprised that Ballymore didn’t choose trees varieties, the suggestion of a few people (well before the tree dispute earlier this year). However two more unusual “vegetation” suggestions came in the form of English grape varieties and… inevitably… cucumber varieties.

    Bacchus Vectina
    Huxelrebe Olympian
    Ortega Fountain
    Seyval Blanc Marketmore
    Rondo Corinto
    Reichensteiner Kekiri
    Madeleine Angevine Wautoma

    Some of the odder suggestions came from people who got hung up on there being 7 towers. The seven dwarves (“Hi, I live in Grumpy House”), the seven days of the week, and the seven colours of the rainbow were all suggested twice. We had the last seven monarchs (which gets confusing with two Georges and two Edwards), seven planets and seven (rather than 8) points of the compass.

    My favourite “whacky” suggestion though was to name the tower blocks after the Secret Seven: Peter, Janet, Jack, Barbara, George, Pam and Colin. Genius.

    There were surprisingly few, shall we say, “satirical” entries, though someone did suggest “Totally, Out, Of, Keeping, With, West, Hampstead”. I don’t think that made the shortlist.

    Alongside the winner, a genuine special mention to Jamie Murray, who put some serious thought into it and chose names linked to William Beckford. Beckford, whose name will appear on one of the buildings, owned West End House, which stood on the site of the development. Here’s Jamie’s submission in full:

    As the towers in the West Hampstead Square development are to be built on the site of the old West End House, surely their names should be selected to commemorate eccentric author William Beckford, “The Sultan of Lansdown Tower”, who grew up there? So “Lansdown” is one obvious suggestion, but what about “Fonthill”, after the abbey Beckford built himself in Wiltshire?

    Vathek, the antihero of the gothic novel for which Beckford is best remembered, is probably a bit too gothic, but what about “Carathis”, surely the most memorable character in the book? She’s based on Beckford’s own mother, Maria, who ended her life at West End House. And how about “Istakar”, after the destination of Vathek’s quest? It’s an old name for Persepolis, and has a lovely ring to it.

    We ought not to forget “Azemia”, the heroine of one of Beckford’s more satirical works. Finally, while northwest London is already graced with a Mozart estate, we really must remember Beckford’s music tutor somehow: so what about “Amadeus” or “Wolfgang”?

    So my suggestions are: Lansdown, Fonthill, Carathis, Istakar, Azemia, Amadeus, Wolfgang.

    But the winner is Ed Fordham whose full list was: “AA Milne, George Orwell, Gerry Anderson, Thomas Hardy, Dusty Springfield, Joe Orton, WH Ainsworth”. Well done Ed, a meal for two at The Wet Fish Café awaits.

  • Property News: Coping with longer tenancies

    Property News: Coping with longer tenancies

    It’s been a busy first quarter for Paramount as we’ve made some major changes to how we manage properties. As the length of the average tenancy increases and the private rented sector becomes a long-term housing solution, we have to adapt to ensure procedures such as inventories continue to be fair.

    In order to combat the lack of knowledge about a property that the shift towards longer tenancies presents, we need to take a proactive and preventative approach to property management. It’s the only way we can protect a landlord’s asset over a long tenancy. We now offer landlords a regular audit of their property during the course of any tenancy which will allow us to spot minor problems before they escalate, such as old water stains from previous leaks or deteriorating wooden windows, ensuring minor issues are identified and fixed long before they become an issue for tenants or landlords.

    We will be enlisting an independent inventory company to provide this service at a cost to Paramount. Inventory clerks are trained, property-savvy professionals who are able to spot small issues before they become big problems. By using an independent, impartial and professional inventory company instead of our in-house management team, landlords will know that all listed works will be recommended. In keeping with our ethos, the inventory company we will be using are an independent family owned business who we have worked with for many years.

    As tenancies get longer there is no doubt that letting agencies need to adapt it order to meet the challenges this change presents. It’s a topic we think a lot about and we will continue to find innovative ways to improve our service inline with these changes.

    Agents Giving

    We are thrilled to have been named Fundraising Champions for the second year running by ‘Agents Giving’, a charity that encourages and supports agents to raise funds for established and recognised charities in the UK.

    We all become blinkered sometimes to what is going on outside of our own world. I believe that it is important to help people first hand in order to see what’s going on inside our local community as well as donating and fundraising for charities like Agents Giving. We’re proud to have been named Fundraising Champions for the second consecutive year, but the real reward is seeing first hand how charities like Ashford Place and Thames Reach improve the lives of others.

    Talking of charity leads us nicely onto…

    Brent Foodbank
    Brent Foodbank, located between Kilburn and Willesden Green, urgently need supplies to donate to those in need in our community. Paramount is working with Brent Foodbank as a donation drop-off point; this means you can donate any non-perishable food items and toiletries six days a week at our office, 150 West End Lane, which we will then deliver to the centre.

    Each week we’ll let you know on Twitter and Facebook what the Foodbank needs the most. This week toiletries are in high demand, so if you’re able to donate shower gel, toilet roll, soap, toothbrushes or shampoo please drop them into our office.

    Spencer Lawrence
    Lettings Director
    Paramount Properties
    150 West End Lane
    West Hampstead
    020 7644 2314

    request a lettings valuation

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  • £645,000 profit on Stephen Fry’s former house

    £645,000 profit on Stephen Fry’s former house

    Photo via The Modern House
    Photo via The Modern House

    “I fell in love with this extraordinary house. It’s an ordinary terraced house, but an architect scooped out the inside and created all these different levels. There are two trees growing through the middle.”

    That was Stephen Fry, in 2002, talking about his house on Sherriff Road in West Hampstead. It’s now on the market again, four years after Fry sold it, for just shy of £2.5 million.

    Fry sold the house around the same time he split from his long-term partner Daniel Cohen. According to the Daily Mail, Cohen received all the proceeds from the sale.

    The house sold for £1,850,000 back in 2010 and it’s back on the market with The Modern House at £2,495,000. It is a spectactular property – five bedrooms over three floors (although the floors are far from traditional in layout), and what the agents now selling it term “significant spatial drama”. That’ll be the tree in the middle.

    The agents, who specalise in architecturally significant properties, explain more: “The house was redesigned in its entirety in the 1980s by the architect Brian Muller, who stripped it back to the structural fabric of brick, joists and lath, and planted a tree that grows through the middle of the space. Huge glazed up-and-over doors flood the interior with natural light and allow it to be opened up to the south-facing garden, providing a seamless transition between inside and out. Metal service ducts and boldly exposed pipework are a nod to the High Tech movement pioneered by architects such as Norman Foster and Richard Rogers.”

    Assuming that the property goes for at least its asking price, it’s a 35% price rise in a little under four years, well ahead of the estimated 25% price rise for the street as a whole over that time.

  • Cheapest flat in West Hampstead is relatively the most expensive (but tiny)

    Cheapest flat in West Hampstead is relatively the most expensive (but tiny)

    A studio flat in Hillfield Road, West Hampstead has just gone on the market for £160,000 – a bargain if you want to live on one of the area’s most desirable roads.

    As you’d expect, the downside to Foxtons’ low asking price for this room (+ shower room) is its tiny size – just 11 ft square (121 sq ft). How big is that? Well you couldn’t fit a full-size snooker table in there. It would be 8 inches too long.

    The master bedroom...
    The master bedroom…

    It may be the cheapest property in West Hampstead (according to Zoopla and Rightmove), but it also works out at possibly the most expensive per square foot, at £1,322.

    This is more than 30% over what you would expect to pay for most larger studio and 1-bed flats, which at the moment usually work out at between £600-£900 per sq ft.

    The cheapest studio in the yet-to-be-built apartments at West Hampstead Square, which set a new benchmark for flat prices in the area, came in at £908/sq ft with an asking price of £405,000. It is only just over 3.5 times the size of this property, so still hardly large.

    However, if you’re shopping around with a budget of less than £200,000, you’ll know there’s not much else available. An ex-council studio flat in Brassey Road has just received an asking price offer of £175,000 after less than a week on the market, according to Peter Gobey at Greene & Co.

    HillfieldRd2
    Open plan kitchen/living room

    Will the – ahem – “bijoux” Hillfield Road apartment sell? Peter Gobey thinks so, “with the market as it is now, I’d expect it to sell as a pied-à-terre or a rental investment.”

    Could this tiny living space be a solution for buyers priced out of West Hampstead’s “bonkers property market“? It may be more appealing to commute to London from Barcelona, or to invest your £160,000 budget in this rather nice 4-bedroom house – in Scotland.

  • Is the property market bonkers?

    Is the property market bonkers?

    ‘Bonkers’. I hear the word repeatedly whenever discussing the West Hampstead property sales market with buyers, sellers and fellow agents alike. Even people with no recent first-hand experience tell me it’s bonkers.

    Newspapers and websites tell us how bonkers it is. A headline in The Sun on Friday reads ‘Property up 2% in a month!’ and goes on to say that this is ‘fuelling fears a property bubble is looming’. Hardly a day goes by without The Daily Express fixating on the impending doom across its front page.

    But how bonkers is it? Is it really a bad thing for London and Londoners? A recent article in the Guardian got me thinking; it tells how a central London property investment company has recently set up a £100m fund (or ‘warchest’ if you’re reading The Sun) to buy 1 and 2 bedroom apartments in prime central locations. The company’s reasoning is that the property price inflation seen over the last 40 years is set to continue at 9–10% per annum for the next 30 years at least. They say they can see no reason for this to change and it’s difficult to argue that they’re wrong: a growing population, strict planning laws, conservation areas, limited space and foreign demand and investment are unlikely to change. Their prediction – and gamble – is that by 2050 a central London flat will cost £36m.

    This seems unimaginable and enormously unfair for many people, but made me realise that this is one of the reasons London is such a great city. The London property market creates huge wealth and prosperity due to the ‘multiplier’ effect of capital injection into services, employment and investment.

    Much is made of overseas investors buying properties in London and never living in them but, in my experience, these people employ local surveyors, solicitors and agents when buying and then embark on expensive refurbishment programmes which employ local contractors and firms, increasing the value of the property and in some cases, gentrifying poorer neighbourhoods, setting new benchmark values for other properties in the process.

    The London construction industry alone counts for 10% of the UK’s GDP and employs nearly 2 million people. Office development in London is now at a 4-year high with 9.7 million sq ft under construction and notable recent landmark sales including Google’s purchase of its new headquarters at Kings Cross. The knock-on effect of such investment is huge.

    This wealth generation also helps create demand and employment opportunities that attract people from all over the world to London, adding to the multi-cultural mix of Londoners that want to buy property whilst giving it such vibrancy and diversification. This is what we all love about London – would we really want West Hampstead and West End Lane to feel any different?

    Homeowners in London also benefit from the consistent rise in prices by being able to unlock large amounts of tax free equity in their homes which they can reinvest into businesses or help future generations get on the housing ladder.

    Of course, those yet to get on the housing ladder, or who need to move to a bigger property, are finding it increasingly hard to make London their home as house price rises outpace wage inflation. The risk is that while London might become more diverse in some ways, in others communities like West Hampstead could become more homogenous as only the relatively affluent can afford to buy here, while everyone else is forced out of the city and onto those crammed commuter trains that run through our Thameslink station every day.

    So, yes, it does all seem a bit bonkers, and perhaps inequitable for those that don’t live in London or are priced out, but the ripple effect of investment and increasing prices is felt across the whole of the UK eventually. It also makes London an incredibly vibrant, eclectic and exciting city.

    Darryl Jenkins
    Associate Director
    Benham & Reeves
    West Hampstead
    020 7644 9300
    Follow @BenhamReeves

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