Market focus:
Shad Thames
Sentiment across the prime London market has improved since the start of this year after the political and money market upheavals in the wake of September’s mini-budget
The landscape for the housing market has changed, as the bank base rate is now higher than the ultra-low rates of the last decade.
However, at the same time, mortgage rates are starting to fall, and lenders are competing for business, creating more advantageous conditions for buyers than several months ago.
The overall economic picture is also brighter than October and November last year, with forecasts now for a shallower, shorter downturn. Buyer demand and overall conditions are more like those in the pre-pandemic years of 2018/2019, but deals are still being done, especially where there is realism around price levels.
The rental market remains very busy, with a continuing imbalance between limited supply and high levels of demand continuing to push up rents, albeit we expect the rate of rental growth to ease through 2023.
23%
of properties currently on the market in SE1 are currently under offer
9.6%
the rise in average residential property prices in Southwark in 2022
10%
annual rise in achieved rents in SE1 3 months to Feb 2023
Sources: Land Registry, Gov.UK, Lonres, Cluttons, Rightmove, Zoopla
Waterfront premium
Our analysis of sale prices for flats shows that proximity to the water generally comes with a premium. These values will be influenced by the type and size of stock, with larger properties putting upward pressure on the averages. Even so, comparing sold price data in the first three quarters of 2022 reveals a large uplift for riverside properties in SE1 and SE16. The average value of sold flats within 250 metres of the river was around £1 million, compared to average values of £600,000 for homes set further back from the river.
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