House price fall but half of Londoners may still leave
Despite the first reported fall in house prices, a YouGov survey has found that one in two Londoners would consider leaving London due to high housing prices in the capital.
On the day that Hometrack reported a 0.1% fall in London house prices, London First and construction consultancy Turner & Townsend announced the results of their jointly commissioned the survey and have argued despite the very modest fall in house prices action needs be taken to relieve the housing crisis in the capital.
Richard Donnell, director of research at Hometrack commented on the slight fall in house prices in London: “After a strong run over the last 18 months, the momentum of house prices rises has started to turn with growth now at a standstill for the first time since January 2013.”
London First chief executive Baroness Jo Valentine said: “London’s chronic housing shortage is already making it difficult for many of those with the talents the capital needs to live and work here, and this problem is only going to get worse unless we start building more homes.”
Turner & Townsend UK managing director Jon White added: “The construction industry has already stepped up to the plate to address London’s chronic need for more homes, but it would perform even better if it were able to unlock development sites in a more cost effective way.”
Around seven in ten people aged between 25 and 39 told the research company that the costs of their rents and mortgages make it difficult to live and work in London with only more workers over 60 reporting it easy rather than difficult to pay for their housing costs.
“The cost of building the infrastructure needed by new developments can be prohibitive, but we’re increasingly seeing developers and utilities providers working together to share the expense,” Mr White said.
“Developments in building technology can also be great enablers, and Turner & Townsend is leading the roll-out of cost-saving innovations like factory-built housing units and high quality kit construction.
“Project design should allow for future growth, and ensure that roads, stations, schools and hospitals can be expanded if needed. This will ensure that extra capacity can be delivered at less cost and with less disruption.
“Finally, the planning process can be speeded up if developers engage early with existing communities. Dialogue that addresses residents’ concerns can improve the design process and help get new homes built more quickly and sensitively,” he added.
Only one in six Londoners said they would view politicians negatively if they started driving through house building locally, which indicates there is a real demand for housing at a local level.
The downturn in prices reported by Hometrack is unlikely to compensate signal a the kind of significant drop off in London housing prices that would be required to help make London more affordable. Ultimately the only way this can happen is if more homes are built in and around the capital.