Pipeline of luxury London flats hits record high

More than 35,000 homes costing £1million+ are due to be constructed over the next ten years in London.

Consultant Arcadis estimates a total sales value of £77bn for these homes which are mainly flats and apartments.
    
The huge pipeline will intensify fears of an oversupply of “prime” properties in the capital.

The total floor space of planned prime homes in the capital is more than 40 million square feet – far greater than the area of the whole of the City of London (30.7 million sq.ft).

Arcadis identified 196 across the capital with the number of homes planned at 35,055.

And the consultant warned some of the luxury resi schemes will have to be “repositioned” into commercial jobs or even cheaper homes as demand at the top end softens.

Mark Cleverly, Arcadis head of commercial development, said: “Since around 2009, the value of prime residential property in central London has seen dramatic rises, making it one of the hottest markets in recent memory.

“That said, things are changing.

“Land, materials and labour are growing in price, meaning the costs involved in actually building these homes is growing significantly.

“This, coupled with a recent gradual easing off of buyer demand could affect margins and mean investors opt to convert their developments to target the more buoyant office and commercial markets.

“With no obvious end in sight to the unpredictability of the global economy this approach could soon become the norm.”

Ref: Construction Enquirer
18/04/16