Madness in the London Housing Market

ukcarper

Out,_Vile_Jelly wrote: »

Zone 4- Morden !!!!!!. Impossible to gentrify.

End of Northern line you might be surprised some of the places I would have been very worried about walking around in 70s are now highly gentrified.

beanie414

I live in Barking and Dagenham and I never thought I would see £300k houses here!:p

purch

The Standard is not the same now it's free.

In the good old days you had blokes standing outside the stations yelling "Stanard....Git your Evnin Stinard", and you went up to him, took a paper, then realised you didn't have any change, hand it back and walk off :eek:

Oi....what's your !!!!in game !!!!

Out,_Vile_Jelly

ukcarper wrote: »

End of Northern line you might be surprised some of the places I would have been very worried about walking around in 70s are now highly gentrified.

When people ask where I live I say it's where you end up if you fall asleep drunk on the Northen Line.

ukcarper

Out,_Vile_Jelly wrote: »

When people ask where I live I say it's where you end up if you fall asleep drunk on the Northen Line.

Went to Merton Tech when it moved to Morden in 70s was quite nice then but when I called in to binocular shop a couple of years ago I was surprised how much it had gone downhill. Still it could be nice I believe there are now trout in the Wandle.

kabayiri

The outside of that million+ council flat is a bit meh isn't it?

Have they never heard of stone cladding?

...give it a bit of class

Samsonite1

London will always go up at a better rate than other parts of the country, as long as businesses and foreign investment comes to London, which it will.

I looked at moving from the South East to London and ended up in Zone 6 (south). Just to illustrate how prices in the SE and London hold value or increase under any circumstances: I was gutted that I bought my SE house towards the very peak of the last boom (end of 2006), I then wanted/needed to move nearer to London in 2010, but with the economic crisis having set in nicely, it was not the best time. Even then, we sold for a small profit of a few £k which surprised me quite a lot - I would not have moved otherwise.

So that was the economic crisis effect on SE house prices after the huge rise for so many years - i.e. they did not go down after 2 years of recession.

Moving onto the past few years - it turns out my Zone 6 house has increase by £120k in the past 2 years. This just seems crazy! From what I can tell, you do not need to be that close to Central London to feel the ripple effect. Having said that, I guess if other cities are having the same effect then the price is all relative APART from first time buyers, who are essentially screwed

cells

London is so easy to explain yet so few people know/realise it

1 London had a huge relative excess of homes in 1991

This was due to to the fact that on average over those 4 decades London built ~25,000 homes a year while its population was falling by on average 32,000 people per year . The result was that in 1991 London had fewer people per home than any of the other regions of the UK which is.....unexpected

For the older folk here you will remember that the talk in the 1970s was how to manage London decline


2 By 1991 the population falls had stopped and the 1991-2001 period was more...stable. Building was still about 25,000 a year but population growth had changed from falling by ~32k a year to growing by ~29k a year

So although there was a big change in that demand was a lot better than the forty years average prior supply was still good vs demand. After all building 25k homes each year for a population growth of 29k persons per year is good and it resulted in a lower persons per home figure by 2001

This population fall was the key to London being cheap in the 1990s. Such a population fall did not happen in Paris or even in Berlin

3 By the 2001-2011 period things completely changed. Population growth increased to +100,000 a year but build rate was similar if only a little lower.

This huge demand increase, from losing 32k people a year, to gaining 100k people a year.....with no corresponding increase in build rate (they actually dropped somewhat) resulted in the boom in prices from the year 2000 to 2008 when the credit crunch hit

4 The credit cruch caused a very temporary price fall as the banks stopped lending. But population growth was so high that did not last long. For about 2-3 years a credit crunch and recession balanced out huge population growth and little supply so prices were flat/stable

5 Once the credit crunch ended/eased there was a mini boom from ~2012-2015 as London played catchup remembering that between 2007-2015 nearly a million people came to London and only ~150k homes were built


A London GDP post 2000 outperformed the rest of England probably due to globalisation and disproportionate population growth due to immigration

B Other countries like France which build sufficient supply also had the same thing happen, prices in paris are up more than elsewhere in France (but not as much as London vs England)

---

That is the past. So what is the future for London.

If you want prices to stop growing I think population growth needs to fall to the +20k per year range (from +100k a year now). Or house building needs to go from ~20k a year towards >60k a year.

padington

cells wrote: »

London is so easy to explain yet so few people know/realise it

1 London had a huge relative excess of homes in 1991

This was due to to the fact that on average over those 4 decades London built ~25,000 homes a year while its population was falling by on average 32,000 people per year . The result was that in 1991 London had fewer people per home than any of the other regions of the UK which is.....unexpected

For the older folk here you will remember that the talk in the 1970s was how to manage London decline


2 By 1991 the population falls had stopped and the 1991-2001 period was more...stable. Building was still about 25,000 a year but population growth had changed from falling by ~32k a year to growing by ~29k a year

So although there was a big change in that demand was a lot better than the forty years average prior supply was still good vs demand. After all building 25k homes each year for a population growth of 29k persons per year is good and it resulted in a lower persons per home figure by 2001

This population fall was the key to London being cheap in the 1990s. Such a population fall did not happen in Paris or even in Berlin

3 By the 2001-2011 period things completely changed. Population growth increased to +100,000 a year but build rate was similar if only a little lower.

This huge demand increase, from losing 32k people a year, to gaining 100k people a year.....with no corresponding increase in build rate (they actually dropped somewhat) resulted in the boom in prices from the year 2000 to 2008 when the credit crunch hit

4 The credit cruch caused a very temporary price fall as the banks stopped lending. But population growth was so high that did not last long. For about 2-3 years a credit crunch and recession balanced out huge population growth and little supply so prices were flat/stable

5 Once the credit crunch ended/eased there was a mini boom from ~2012-2015 as London played catchup remembering that between 2007-2015 nearly a million people came to London and only ~150k homes were built


A London GDP post 2000 outperformed the rest of England probably due to globalisation and disproportionate population growth due to immigration

B Other countries like France which build sufficient supply also had the same thing happen, prices in paris are up more than elsewhere in France (but not as much as London vs England)

---

That is the past. So what is the future for London.

If you want prices to stop growing I think population growth needs to fall to the +20k per year range (from +100k a year now). Or house building needs to go from ~20k a year towards >60k a year.

Prices can stop growing if we get a speculative boom followed by a bust, which everything looks set to do because the fundamentals looks too good to not happen. The investors just wont be able to resist over egging this rather promising looking market.

However as you say, the average line is up up up, but some weak handed latecomers to the party are going to get battered at some point post 2018.

Samsonite1

padington wrote: »

Prices can stop growing if we get a speculative boom followed by a bust, which everything looks set to do because the fundamentals looks too good to not happen. The investors just wont be able to resist over egging this rather promising looking market.

However as you say, the average line is up up up, but some weak handed latecomers to the party are going to get battered at some point.

I do not think so - there is a lot of money out there and it will always be spent in London. Rich people are queuing up to buy properties in London. The cheaper end will be bought to rent out. Land is so premium in London that prices will always be high. If a huge global economic crisis cannot bring London prices down significantly (in that they are higher than before even now), then what will?