Cranes stand above residential apartment construction sites including Ballymore Group... Read More
Average sales prices of new apartments in London’s most expensive districts exceeded those of older flats by 43.1 percent at the end of the first quarter, down from 67.6 percent in 2012, according to a report by London-based broker Huntly Hooper Ltd. An increase in construction combined with a weaker property market may reduce the gap further during the year, Oliver Hooper, director of Huntly Hooper, said in the statement.
Developers including Berkeley Group Holdings Plc (BKG) and CLS Holdings Plc (CLI) are transforming London’s skyline with apartment towers lining the River Thames as they seek to gain from the city’s popularity with foreign investors. Building firms plan to construct more than 20,000 luxury properties in London during the next decade even
as the market cools, EC Harris LLP said in a November report.
“We are growing increasingly concerned about the price sustainability of flats” costing more than 1,000 pounds a square foot, JPMorgan Chase & Co. analysts including Tim Leckie said in a Sept. 5 note. By the time London employees achieve the salaries needed to afford them, “they are well into their careers and are looking for family accommodation, not a two bedroom, 700 square-foot flat in a high density development with no outside space,” the analysts said.
The average initial selling price of a new apartment in London’s most expensive districts has climbed 151 percent to 1.5 million pounds ($2.4 million) since 2009, Huntly Hooper said. The average resale value for older properties has gained about 61 percent to 1.1 million pounds, according to the report.
EC Harris, based in London, defines luxury homes as those that will sell for 1,250 pounds a square foot or more.
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