Big boost for central London property as buyers consider office return
Demand for city centre apartments is returning fast in Britain after buyers opted to work in rural locations during the pandemic, according to a new survey.
Rightmove said flats are now the most in-demand property type for the first time in ten years, with buyer interest up 39 per cent since January.
The rise is based on the number of times people contacted estate agents about properties.
Interest in city centre housing has risen by 35 per cent, compared with a 32 per cent increase in demand for housing in villages.
Pandemic property boom continues
The survey shows that the British property market’s pandemic boom has continued, as buyer demand for flats in April stood 51 per cent above pre-pandemic levels.
This has been helped by a stamp duty holiday extension and a new mortgage guarantee scheme for first-time buyers who cannot afford large deposits.
“These are early signs, but they certainly point to some good news for city centres across Britain, with a number of agents now telling me they’ve seen a marked uptick in demand from first-time buyers,” Rightmove’s director of property data, Tim Bannister, said.
City centres ‘staging comeback’
Official data published earlier in the week showed house prices rose in March by more than 10 per cent in annual terms, the biggest increase since August 2007.
The Office for National Statistics said prices of detached houses rose by 11.7 per cent in the year to March, compared with a five per cent increase for flats.
Since then, pubs, restaurants, and non-essential shops have reopened, with most Covid restrictions set to end next month.
“People starting to venture into their local high streets and once again experiencing the buzz of their city centres, along with greater mortgage availability for first-time buyers, means city centres are staging a much-needed comeback,” Bannister added.
Central London office demand
In addition to a jump in demand for residential properties in inner London, other data published today shows that there is also an increase in demand for office space.
Property consultant DeVono Cresa said this morning that following the easing of restrictions, the ongoing vaccine programme and a growing appetite to return to the office are providing a renewed outlook with businesses looking closely at their property requirements.
The firm found that, during the first quarter of this year, 1.6m sq ft of office space was leased across central London, representing a 27 per cent compared to the fourth quarter of last year.
Moreover, the average deal size during the first three months of this year marginally increased by 7 per cent, to 6,812 sq ft, though still down 12 per cent on the long-term annual average.
A continued rise in availability saw levels increase by 8 per cent over the quarter to just shy of 20m sq ft, DeVono Cresa found.
The greatest rise in office availability over the past quarter were in markets that saw slower growth in 2020, with East Fringe up 32 per cent, the Southbank up 20 per cent and the Docklands up by 14 per cent.