In the Red Book 2012 published a couple of months ago we stated that the number of private construction starts during 2011 in London was 13,186 units, a 29% increase on the previous year’s figures. We went on to explain that although the figures, on the surface at least, were very encouraging the detailed picture was less so.
During 2011 there was a very clear dichotomy between inner and outer borough starts, a 53% increase in the outer boroughs compared to near flat-line growth in the inner boroughs. In a nutshell we were witnessing two very different markets at work, one driven by debt in the outer boroughs one driven by equity in the inner boroughs. If such a scenario was really the case we would have expected a drop in capital values in the outer boroughs as developers sought to woo first time buyers and an increase in capital values in the inner boroughs as more and more equity chased ever decreasing amounts of super prime stock. Our data showed precisely that, a 7.9% fall in capital values in the outer boroughs a 6.7% rise in the inner boroughs, the polar opposite.
In this London Residential update we take another look at the inner boroughs at this mid-year point from the applications and permissions in the planning pipeline, the starts and completions in the construction pipeline and ending with a flavour of the sales and pricing situation.
About this report
This report was compiled by the EGi London Residential research team. EGi provides comprehensive, in-depth coverage of the London Residential market including detailed sales, pricing, planning, and construction information along with expert analysis and commentary.