London supply exceeds demand, number leaving 80%

AG47

The number of people leaving London has jumped more than 80 per cent in the past five years, with more than 93,000 people departing the capital last year, figures have suggested.http://www.cityam.com/269004/exodus-number-people-moving-out-london-has-risen-80-per

And yet the building bubble shows no signs of abating

lisyloo

I don't agree with your title/conclusion.
There clearly is demand (otherwise the building bubble wouldn't continue unabated) - it's just not from people living in the capital.

lisyloo

Trying to work this out (sorry if being dense) but are they says births - deaths > leavers (93,000) - entrants

Crashy_Time

http://www.thisismoney.co.uk/money/markets/article-4735006/Torrid-day-UK-s-largest-estate-agents.html

AG47

So there are now more people leaving London than new people moving in

And a lot more properties being added to the supply

Something doesn't add up, who will live in all these overpriced flats being added to the supply

lisyloo

AG47 wrote: »

So there are now more people leaving London than new people moving in

And a lot more properties being added to the supply

Something doesn't add up, who will live in all these overpriced flats being added to the supply

People don't live in them, lots of them are left empty.
Many are bought by Chinese, Malaysians etc. In fact some developments are exclusively marketed abroad.
They don't rent them out preferring to keep them pristine.
They are deposit boxes in the sky.

In some places e.g. Vauxhall tower, you can see hardly any lights on at night.

Is this news to you?

Almost all of the flats being built in central London are the "luxury" variety starting at £400k min for a studio, so few Londoners would want to buy them.

GreatApe

lisyloo wrote: »

People don't live in them, lots of them are left empty.
Many are bought by Chinese, Malaysians etc. In fact some developments are exclusively marketed abroad.
They don't rent them out preferring to keep them pristine.
They are deposit boxes in the sky.

There is no evidence for this being common at all
The only 'evidence' put forward by the media is photos of apartments with most the lights off

But guess what, if you go at night and look at any council tower block (which is close to 100% full) most the lights are off. The reason is that residents dont keep lights on to help statisticians figure out occupancy rates.

Try this next time you are on a normal street at night and observe from the street how many lights are on.

In some places e.g. Vauxhall tower, you can see hardly any lights on at night.

haha yes sure

When I look at my street at night you cant see any light on for most the houses
Possibly because people are asleep, people have blinds, people move towards the back of the properties where you cant see them but perhaps the biggest reason is that the most common occupancy type is 1 person households which means of the 5 rooms only 1 has a light on. Not to mention from the street you only can see two of the 9 rooms so 80% of the rooms lights arent visible on the street

Just try it the next time you are out at night, look at council estates or private roads. If you use the metric of lights visible you would conclude 80% are empty even though we know occupancy rates in the uk are 99% (that is to say less than 1% empty and most that 1% will be dilapidated properties)

GreatApe

Bloody councils leaving 80% of their stock empty

How do I know, just look at the lights!!!

GreatApe

lisyloo wrote: »

Is this news to you?

It simply isn't true

Almost all of the flats being built in central London are the "luxury" variety starting at £400k min for a studio, so few Londoners would want to buy them.

Its dam expensive building property in London primarily because of additional government burdens (the biggest of which is that half the new builds must be given away at below cost) and secondly because a lot of development has to be done on the basis of buying a street or estate with x properties knocking them down and replacing with 2x properties. That means huge cost compensating the current owners

Also most people simply are unaware of the vast wealth of this country.

Just look at new cars or public schools, most people will never buy a new car or be able to afford to send their kids to public schools because it is unaffordable for them. That does not mean new car sales and public schools dont exist or are unsustainable. It just means only about 10% of the population can afford it

London is unaffordable for the 90% but it isn't unaffordable for the 10%
This 10% can sustain London just like they can sustain the car industry and the public school industry

GreatApe

Another photo showing that lights on/off is a poor indicator of how full or not a building is
That council tower would be close to 100% full but the lights would make a person perhaps conclude that it is 80% empty

Crashy_Time

lisyloo wrote: »

I don't agree with your title/conclusion.
There clearly is demand (otherwise the building bubble wouldn't continue unabated) - it's just not from people living in the capital.

Isn`t it just a case of contracts have been signed and the developers will continue to build until they go bust? Mothballing projects will only bring on the much needed crash sooner by affecting sentiment? (This is good for ordinary people but bad for developers)