With houses prices in Greenwich rising way above the London average, we ask local property consultant JLL what’s next for SE10…
The Royal Borough of Greenwich topped a list of places recording the largest increase in house prices in 2014, according to figures from Halifax. The average house price rose from £263,183 to £328,044 in the 12 months to November – a 24.6% rise that is almost three times the 8.5% increase across the UK. In London, prices went up by 13%, or £43,935, to an average of £381,483. But what are the reasons for this huge leap in pricing? We asked property consultants JLL, which has been active in the local market for years.
‘People are migrating over here from north and west London because the perception is that it’s better value, but equally as nice,’ says Graham Lawes, Branch Manager at JLL Greenwich.
‘The transport links into Canary Wharf are very appealing because the daily commute is a bit of a grind.
‘It’s also been largely supported by the economics of supply and demand,’ says Tim Howells, Assistant Sales Manager at JLL Blackheath. ‘We continue to see short supply and high demand, driven by professionals working in the City and Canary Wharf with easy access to cheap funding. That’s driving the market forwards, as well as the desire to move to Greenwich, with its open spaces, history, character and easy access to work.’
‘There’s also an element of catching up,’ says Graham. ‘Prices didn’t do a lot for about five years, they pretty much stayed stable, so I think we were due a correction. If you consider that prices on average go up 5% a year, then that takes you to your 25% over five years. So prices in the area were due an increase.’
So what was the trigger that made house prices suddenly leap?
‘I think everything realigned,’ says Graham. ‘Access to funding came back and confidence came back, and that brought committed buyers and sellers.’
All of this makes for a more active rental market too, since rising prices often mean that people will hold on to their properties and rent them out, holding out for a higher selling price. There’s also the huge boom in new build developments right along the river from Deptford to Greenwich Peninsula.
‘Investment in development is huge at the moment,’ says Charlotte Russell, lettings consultant at JLL Greenwich, ‘so we can offer people luxury riverside living, which just wasn’t here before, that was very much in Canary Wharf.’
‘There are a large proportion of landlords who prefer the new builds for buy-to-let opportunities,’ adds Graham, ‘as opposed to your two-up two-down Victorian cottage, which was previously the area’s typical housing stock. I don’t think the rental yield works as an investment anymore for the value of those period properties, if we consider it’s £600,000-650,000 now for a two-bed cottage, whereas they do on those new builds along the river.’
With so many impressive new builds, what are the key developments that buyers should be looking out for?
‘From a rental point of view, phase three of The River Gardens is going to be exciting,’ says Charlotte. ‘That’s due for completion at the end of 2016 and the spec of the units is great. The last phase was really popular but this one brings in the gym and the swimming pool. Then there’s the Peninsula. Peninsula Tower is a really luxurious hotel-style development – you’ve got access to everything in there, all the concierge services, the spa, cinema rooms, office areas… it’s going to be a first for Greenwich because we haven’t really seen anything of this super-prime spec before.’ Another development there, Platinum Riverside, has really good units and great views, so the demographic in that area is really changing. It’ll become much more of a residential community.’
Graham, who has worked in estate agency in the area for 21 years (James Johnston and King Sturge, which then went on to merge with Jones Lang LaSalle, now JLL) and lived in the area all his life, has certainly seen the area grow and evolve: ‘Greenwich has changed a lot,’ he says, ‘driven by a younger set coming into the area looking to rent somewhere that’s an easy commute to Canary Wharf. They often find they love the area and end up becoming our buyers. That’s also driven a lot of changes on the high street, with good restaurants like Jamie Oliver, Sticks N Sushi and a few others coming into town.’
Does Graham expect the colossal price rises of 2014 to continue? ‘I don’t think house prices can continue to rise at that rate,’ he says. ‘I think that was an adjustment and we’ll see something more sustainable now, similar to the UK average of about 4-6% year on year, which is healthy growth.
‘Everything spirals out as prices jump up, so Deptford, Lewisham and Woolwich will all come up in line with that. Lewisham Gateway, a massive development that’s really changing the demographic of Lewisham. We have a lot of enquiries from people specifically asking to live next to Lewisham Station because the transport is good. But Greenwich and Blackheath remain popular because of the history, the people who already live here and love it, and the style of property. The SE3 and SE10 postcodes will always have that level of desirability.’
For further details or property advice call JLL Greenwich on 020 8858 9986 or see jll.co.uk