Robert Soning, COO of Londonewcastle took time out to reflect on the changes in the London residential property market recently:
The style and quality of design of new developments has changed dramatically since 2007 - for the better. Developers have to try a lot harder and really get the details right – specification, style, finish and services have all got to be right to appeal to buyers.
The Growth of Residential Services
What has also really changed, is the continuing upwards drive for residential services which used to be the preserve of prime area developments only – I’m not just talking about swimming pools and gyms, but screening rooms, private residents clubs, libraries, business centres, wine storage and 24hr onsite concierge services. When we tabled the idea of the latter for The Henson development in Camden back in 2007, people thought we were mad, but residents really bought into it. We are going to see this trend continue as people continue to work longer hours and travel more, spending less time in their homes while buying more goods online for delivery to their home address.
I think interior design has evolved and become more expressive. Thankfully, most developers have moved on from thinking that every buyer in the world wants an Eames chair.
In terms of demand, it’s well documented that we are currently experiencing a surge in international buyers – with 59% of all buyers of prime stock being International and up to 70% for new build developments in prime areas.
The two main difference between now and 2007 is the breadth of new markets that are now investing in London beyond the traditional major European states and selected Far Eastern and Middle Eastern nations.
The breadth of areas that are now being invested in beyond the usual has also changed to encompass areas that would not have previously been considered and this has been driven by quality developments with quality specifications and services that meet the needs of these international buyers and investors.
For example, Russian clients didn’t really featuring back in 2007, but we had a number of buyers from the country at The Henson. Mainland Chinese customers were also not a part of the market, but now represent about 3% with a heavier bias in Canary Wharf. Malaysians have also entered the market in greater numbers – with about 350 off the total 900 or so off plan sales for Circus West, the first phase of Battersea Power Station’s regeneration.
What will be interesting over the next couple of years is if Chinese customers will grow as a percentage of the market – especially outside of their currently favoured areas and price point - and the oft talked about growth of BRIC countries – especially India, where few inroads have been made other than a few sales at the top of the market.
Londonewcastle creates individual developments for people with individual taste. We develop with the domestic owner-occupier market in mind and it’s that vision that our overseas customers want and buy into.
Outside space is always at a premium, but customers really want to maximise useable space. As a result, ‘Winter / Sky Gardens’ do seem to be in vogue at the moment. They can now be seen at numerous other developments across the capital. We have designed them into our Dollar Bay development in Canary Wharf and it’s easy to understand why they have become popular with architects, developers and planners alike. They provide flexible, year round, usable inside-outside space and amenity. You have the flexibility to use what would traditionally be a terrace for a number of uses – sun lounge, library, study or additional living space.
Customers see the benefit because we are limited to the amount of time we can use outside spaces in this country due to the climate or in a tall building, due to the height, perception of safety and wind. It’s the opposite situation in hot climates, where there is a preference for shaded and/ or climate-controlled spaces to escape from excessive heat, humidity and poor quality air.
In addition to private amenity space, it is also good to provide shared communal spaces in developments where neighbours can relax. It improves the richness of the development and helps to foster communities with the development.
A New London?
Yes, as prime areas have extended it has pushed traditional notions of prime (defined by areas that cost £1,000 per square foot (psf) – Nine Elms, the city fringe (encompassing Old Street and Shoreditch), Paddington, Kings Cross all spring to mind.
Shoreditch is now commanding £1,000psf for quite average developments on the right streets and we have high hopes for our proposed development of the Huntingdon Estate in this area which will deliver a specification and living experience that has not been seen in the area before.
Legislation is always changing and evolving – from greater community/ public consultation – which we welcome - to moving towards carbon-neutral new developments including thermal efficiency, the use of recycled materials in construction to the energy efficiency heating/ cooling systems and appliances.
Interior Design Evolved
Open plan living has continued as a trend, rather than it being new. I think we are moving away from Scandinavian simplicity to more expressive interior design with a wider palette of seemingly clashing materials that work well when used intelligently together, but admittedly this is in more individual areas and seems to be less prevalent in the ‘greige’ parts of town.
One thing we are really seeing in new developments is demand for as much storage space as possible throughout the apartment – or within the development; for example, the provision of storage boxes in basements can command as much of a premium as car parking spaces.
Technology in the Home
We are going to see the continued increase of home automation – the one thing that hasn’t been linked up yet is bathrooms and kitchens. You will be able to switch on appliances remotely via smart devices, fill a bath and put your fridge in holiday mode for example. There is no reason to believe that you won’t be able to control security and access to your home too as it is already possible to set up profiles for home automation systems today.
I think we are likely to see screens and audio systems being even more integrated into the fabric of the home – multi function screens that act as TV, home hub and communication devices.