Residential Roundup - 1 September

thumbnail

jll-ir-the-residential-roundup

https://res.cloudinary.com/jll-global-olm-np/image/upload/v1693811428/resi/gb/cms/News/Images/residential-roundup/residential-roundup-1-september.png

The Residential Roundup - July

<p>Annual inflation figures for July and
August are expected to bring better news for the UK economy as the impact of
higher energy costs recedes. But higher than forecast rates reported so far
this year and rising core inflation measures are leading forecasters to
speculate that base rates will need to increase further and stay higher for
longer.<o:p></o:p></p>

https://res.cloudinary.com/drt5ol8ck/image/upload/v1693308671/videos/APAC%20Event%20Images/JLL_IR_Website_The_Residential_Roundup_Cover_Photo_Final_1920x1080.png

<div class="row">
    <h2><strong style="background-color:initial;font-size:inherit;text-align:inherit;text-transform:inherit;word-spacing:normal;caret-color:auto;white-space:inherit;">Q2 2023 Sales Index</strong><br /></h2>
</div>
<p><strong></strong>The JLL Prime Central London Index saw prices fall for the third consecutive quarter.&nbsp; The Q2 2023 index recorded a quarterly fall of 2.1%, with prices 5.9% down compared with the same period in 2022. Prices are now 6.8% lower than
    they were when prices peaked in the third quarter last year.&nbsp; </p>
<p>The upper echelons of London&rsquo;s prime market are proving more resilient. With prices down 0.8% in the 12 months to June 2023 compared with a 6.7% fall in homes priced at under &pound;2 million (likely to be most impacted by changes in interest rates).
</p>
<p>Despite sentiment impacting prices we saw deals agreed (exchanges) increase in an admittedly slow Q1 this quarter, with a 28% increase in sales in Q2 2023.&nbsp; With volumes on par with Q2 2022 (down -1.2%). </p>
<p>Stock levels rose in Q2, with 8.3% more properties on the market than in Q2 2022 and 9.7% more than at the end of the first quarter this year. Stock on the market is now at the highest level since the end of Q2 2020. </p>
<h2><strong>Q2 2023 Lettings Index</strong></h2>
<p><strong></strong>The uncertainty which is hampering activity in the sales market often has the opposite effect on lettings. With households more likely to stay in rented for longer or choosing to rent when delaying their decision to buy. Just over half
    (51%) of JLL deals agreed in Q2 2023 were renewals, up from 45% a year ago and 24% in Q2 2021. This was the highest rate of renewal since Q2 2020. </p>
<p>The number of new lets rose this quarter compared with last, up 13%.&nbsp; But the second quarter is usually more active than the first. Comparing new lets agreed (excluding renewals) in the second quarter this year with Q2 last year showing there were
    18% fewer deals agreed, with the number agreed down 35% compared with the Q2 five-year average.</p>
<p>This quarter the JLL Prime Central London Index saw rents rise by 1.9%, with rents 5.4% higher than they were at the same point a year ago. Small flats (1 and 2 beds) saw this highest annual increase in rents at 6.7% whereas more expensive properties
    (&pound;3,000 per week or more) saw a more modest 2.9% annual increase. </p>
<p>Rents are now 26% higher for one-bedroom flats (which have seen the highest growth) than they were three years ago at the end of Q2 2020. With the JLL Prime Central London Rental Index 19.2% higher overall over the last three years.</p>
<p>For prospective tenants having to contend with low stock levels there appears to be some respite as we move into the summer. Stock levels are starting to increase, albeit off a low base. With the number of rental properties listed to let at the end of
    Q2 2023 up 13.8% on the same point in 2022. But volumes remain 55% down on levels we were seeing pre-pandemic in Q2 2019. </p>
<h2>All Source: JLL/ LonRes</h2>
<p><strong>Our JLL Prime Central London Index is based on a &lsquo;basket&rsquo; of properties, valued by JLL at the end of each quarter. </strong></p>
<p><strong>Director of UK Residential Research at JLL, Marcus Dixon, explains: </strong></p>
<p><em>&ldquo;The implications of stubborn inflation on the UK mortgage market are hampering activity in prime central London. While fewer buyers are heavily indebted - almost half buy cash - uncertainty surrounding the short-term outlook is impacting prices. </em><em></em></p>
<p><em>&ldquo;The lettings market remains competitive, stock levels have improved on their 2022 lows but there are still more prospective tenants than there are properties. This has resulted in further rent increases this quarter, with rents almost 20% higher than they were in 2020.</em><em></em></p>
<p><em>&ldquo;The lower end of the rental market continues to see a steady stream of (formerly) prospective buyers moving across into lettings. With smaller properties, mainly one- and two-bedroom flats, recording the highest annual increase in rents, while prices for similar properties are seeing more significant falls than homes in more expensive price bands.&rdquo;</em></p>

JLL – Prime Central London (PCL) Index – Q2 2023

may-2022-1920x1080[1]

The recent rise in interest rates does not impact all sectors of the housing market equally.

Prime Central London (PCL) Index – Q2 2023

https://res.cloudinary.com/global-cms-assets-np/image/upload/f_auto,q_auto/v1688719980/resi/gb/Articles/Images/104786388.jpg

<p>2022 was a record-breaking year for Prime Central London (PCL). Buyers spent almost &pound;5.2 billion on homes last year, 9% higher than in 2021, already a strong year, and the highest amount spent for more than ten years. Even in 2014, when sales reached
    &pound;4.94 billion, 5% less was spent than in 2022.</p><a href="https://res.cloudinary.com/drt5ol8ck/image/upload/v1673866400/videos/APAC%20Articles/JLL_PCL_Report_Q4_2022.pdf" target="_blank">
 <button class="Button primary">Download report</button></a>

Prime Central London Report - Q4 2022

thumbnail_Cover_Photo_-_UK_Report

https://res.cloudinary.com/drt5ol8ck/image/upload/v1674037890/videos/APAC%20Articles/thumbnail_Cover_Photo_-_UK_Report.png

<p><a href="https://storymaps.arcgis.com/stories/5c2aeccd86c64c6abe619f4e73b8b183" target="_blank"><button class="Button primary">View the full report</button></a></p><br /><p><strong>The JLL Big Six Residential Report compares activity, prices, and rents across six UK cities outside London:
        Birmingham, Bristol, Edinburgh, Glasgow, Leeds and Manchester. This report incorporates data from the JLL UK
        Cities index, comparing changes in prices and rents across mainstream and prime developments in each
        city.</strong></p><p>In the last ten years UK cities have recorded some of the highest increases in new residents. Figures from the 2021 census show that across England &amp; Wales more than 33.6 million people, over 56% of the population, lived in cities, 2 million more
    than in 2011.</p><p>With the pandemic accelerating the adoption of hybrid working some questioned the future of urban living. But the influx of new residents heading for our regional cities proves there is more to city living than just the attraction of a short commute.</p><p>Demand for homes has risen across our Big Six cities this year. Back in 2020 and early 2021 we saw an acceleration in the number of households looking to leave urban areas and escape to the country. Yet 2022 has firmly signalled the return to the city.
    Students and young professionals are returning in their droves. Rents have risen this year across all our Big Six cities and the new homes market, both build-to-sell and build-to-rent has seen activity increase too.</p><p>Help to Buy has been a key source of demand for city centre new build over the last ten years. Across the four English cities, over 13,200 equity loans have been issued on Help to Buy homes since the beginning of the scheme. &nbsp;But with 31 October
    marking the end of Help to Buy registrations nationally we were already anticipating interest from first-time buyers would fall in 2023. Combine this with recent rate rises and we expect the number of first-time buyers could fall further.&nbsp;But
    with fewer households buying homes we anticipate demand for rental properties will increase.</p><p>Almost 100,000 homes have been completed in the city centres of the Big Six in the last ten years.</p><p>Demand for homes has meant prices achieved in the last three years have risen by an average of 14.6%. The JLL Cities index, which values new flats in each city shows prices have risen by between 4.9% and 17.6%.</p><p>Demand for rental properties has increased too. With rents rising by an average of 15.4% across the Big Six. Leeds recorded the highest annual increase in rents, with scarcity of stock pushing average rents for new homes in the city up by more than 20%
    in summer 2022 compared with the same period a year earlier.</p><br /><p><a href="https://storymaps.arcgis.com/stories/5c2aeccd86c64c6abe619f4e73b8b183" target="_blank"><button class="Button primary">View the full report</button></a></p>

Big Six Residential Development Report

Cities_header (1)

The JLL Big Six Residential Report compares activity, prices, and rents across six UK cities outside London: Birmingham, Bristol, Edinburgh, Glasgow, Leeds and Manchester.

https://res.cloudinary.com/global-cms-assets-np/image/upload/v1667830502/resi/gb/Articles/Images/Cities_header.jpg

JLL UK House Price Forecasts - Housing set for a correction, not a crash

Architecture-close-up-037-2880-850

Housing set for a correction, not a crash

https://res.cloudinary.com/global-cms-assets-np/image/upload/v1667223576/resi/gb/Articles/Images/Architecture-close-up-037-2880-850.jpg

<h3>An oversea buyer&rsquo;s guide to investing in Prime properties in London, UK</h3><p>Luxury properties in Prime Central London (PCL) present a solid investment opportunity for overseas buyers.</p><p>The financial and political stability that London affords means that, with the right advice and preparation, investing in London property could result in a springboard for your investment portfolio, a secure pension, or a route to setting your family
    up for the future. </p><p>Whatever your investment goals, this expert guide is designed to help. Explore the potential opportunity when investing in Prime Central London real estate, the attractions
    that make PCL such a desirable place to buy, and the mechanics of buying a UK property as an overseas investor or non-UK citizen.&nbsp;<strong></strong></p><h3>What is the size of the opportunity in Prime London properties for an investor?</h3><p><strong>Prime Central London real estate &ndash; sales growth</strong></p><p>According to the <a href="https://residential.jll.co.uk/insights/news/prime-central-london-q1-2022">JLL Prime Central London Sales Index</a> &ndash; our quarterly study into how the PCL market is performing, there was a 3.3% annual
    increase in achieved prices in Q1 2022, with prices up 0.6% on Q4 2021. Achieved prices for Q1 2022 came in at 4.7% higher than pre-pandemic (Q1 2020).</p><p>The same study showed a 7% annual increase in sales, making Q1 2022 the busiest Q1 for five years. Activity was predominantly driven by properties listed at between &pound;2million and &pound;5million, with sales up by a quarter (25%) on Q1 2021.</p><p>Post-pandemic, Londoners continue to make the return to the office, on a full time or flexible working basis, which in turn is driving demand for Prime Central London flats.
    Between January and March 2022, we saw a rise of 13% in the number of PCL flats sold, compared to Q1 2021.</p><p>With Prime Collection properties commanding strong prices, there continues to be opportunity for overseas investors who are looking to own and occupy or buy to let.</p><p><strong>Prime Central London real estate &ndash; lettings growth </strong><br /></p><p>Now is a good time to invest in the buy to let Prime Central London real estate market. Our <a href="https://residential.jll.co.uk/insights/news/prime-central-london-q1-2022">JLL PCL Rental Index</a> recorded a 15% increase in
    rents achieved &ndash; the highest annual rise in more than 10 years. <br /></p><p>This 15% annual increase in achieved rents also put Q1 2022 3.1% higher than Q1 2020, pre pandemic, proving that the rise wasn&rsquo;t the result of a pandemic dip. <br /></p><p>As always, there is movement out of and within Central London, with renters negotiating a competitive market. In 2021, some PCL tenants were in a strong position to negotiate significant rent reductions. In 2022, we are seeing many tenants appreciate
    how competitive the Prime Central London rental market is and therefore paying more to stay in exclusive locations. <br /></p><p>JLL research shows an 18% annual increase in the number of rent renewals across Prime Central London in Q1 2022, compared with Q1 2021, during the pandemic.&nbsp;</p><p><strong>Attractions in Prime Central London that make this area a unique investment opportunity</strong><br /></p><p>London&rsquo;s mix of the historic and the modern makes the city a truly unique place to explore, invest in and live. There is an overview of the local area and property types in Knightsbridge, Kensington &amp; Chelsea, Mayfair, Marylebone, Belgravia,
    and Westminster in: <a href="https://residential.jll.co.uk/insights/research/guide-to-investing-in-prime-properties-london-uk-jll">&lsquo;<span style="text-decoration:underline;">Are luxury properties in Prime Central London a good investment?</span>&rsquo;</a>.
 <br /></p><p>Prime Central London covers the following six areas:</p><ol><li>Knightsbridge </li><li>Kensington &amp; Chelsea</li><li>Mayfair</li><li>Marylebone</li><li>Belgravia</li><li>Westminster<br /></li></ol><p><br />To make sure you find the right property, in the right area, at the right price, it is critical to work with trusted experts who have in-depth knowledge of the Prime Central London real estate market.&nbsp;</p><p><strong>The mechanics of buying Prime properties in London as an overseas investor </strong><br /></p><p>According to research published in Showhouse<sup>1</sup>, overseas investment in Prime Collection properties collectively brought an estimated &pound;1,188million to
    the Prime Central London market in 2020. Of Prime transactions in 2020, 11% came from French nationals, 9.2% came from Hong Kong and the USA, 8.3% from China, and 7.3% from India. <br /></p><p><strong>Here, we answer some frequently asked questions from overseas buyers:</strong><br /></p><p data-list="0" data-level="1">-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <strong>Can a foreigner invest in UK property?</strong><br /></p><p>Yes. In 2020, more than 40% of investment in Prime Central London&rsquo;s luxury properties came from overseas investors. Residential estate agents like <a href="https://residential.jll.co.uk/">JLL</a> are well versed in guiding
    overseas buyers through the UK buying process. <br /></p><p data-list="0" data-level="1">-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <strong>What do overseas buyers need to know about the UK buying process?</strong><br /></p><p>The estate agency you partner with (i.e. JLL) and the conveyancing solicitor you appoint are both critical to this process. Once you&rsquo;re ready to buy, the amount you are offering to pay (your <strong>&lsquo;offer&rsquo;</strong>) is presented to
    the seller by the estate agent. You will need to be able to prove how you will fund your offer, how quickly you are looking to &lsquo;exchange&rsquo; and &lsquo;complete&rsquo; (more on these below), and who your solicitors are. <br /></p><p>If your offer is accepted by the seller, your solicitor will carry out the conveyancing process on your behalf. This is complex, but, in brief, your solicitor will carry out <strong>&lsquo;searches&rsquo;</strong> of the Land Registry and Local Authority
    records to examine the planning history and to look for any potential developments surrounding the property. You will also need to instruct a property surveyor to check the structural strength of the property &ndash; this is known as getting a <strong>&lsquo;survey&rsquo;</strong>.
 &nbsp;
    <br /></p><p>Next, the seller&rsquo;s lawyers draft a sale agreement (also known as a <strong>&lsquo;contract&rsquo;</strong>), which, once agreed by both parties, is signed by you and them. The signed sale agreements or contracts are then exchanged between your lawyers
    and theirs. This is known as <strong>&lsquo;exchange&rsquo; </strong>and means you are legally bound to proceed with the purchase and pay a deposit.<br /></p><p>The next step is to &lsquo;complete&rsquo; on the purchase, at which point you pay the balance of the purchase price and formal documents will be signed and dated, transferring the property from the seller to you. Your proof of ownership, known as <strong>&lsquo;title deeds&rsquo;</strong>,
 can then be found on the public register at the Land Registry. <br /></p><p>It is important to be aware that there are different types of ownership in the UK. <strong>Freehold</strong> means you own it completely, and <strong>leasehold</strong> means there is a time limit on the number of years you will own it for. However, many
    leaseholds are very long (up to 999 years) and freeholds can also be purchased if the freeholder is open to selling it. <br /></p><p>Once you have completed on a property and you become the legal owner of the property, you will be liable for <strong>Stamp Duty</strong> land tax, which is payable to the Land Registry within 30 days of completion. <br /></p><p><a href="https://residential.jll.co.uk/#contactus">Get in touch</a> if you are considering buying in the UK for the first time and would like our experts to guide you through this process over the phone.<br /></p><p data-list="0" data-level="1">-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <strong>Invest, or own and occupy? </strong><br /></p><p>UK property tax laws can be complex, which makes it crucial to work with estate agents and conveyancing solicitors who can direct you through the process efficiently. <br /></p><p>Depending on whether you decide to invest in UK property to live in (own and occupy) or as an investment (buy to let), the tax implications will be different. <br /></p><p>Since 1<sup>st</sup> April 2021, UK non-residents purchasing residential property in England and Northern Ireland are required to pay a 2% Stamp Duty surcharge. This is in addition to: <br /></p><ul><li>The 3% Stamp Duty surcharge on purchases of &lsquo;additional&rsquo; dwellings. This could be property you are buying as a second home or as a buy to let property;</li><li>The 15% Stamp Duty rate on property purchases more than &pound;500,000 by companies; and</li><li>The Stamp Duty rate for UK home buyers.<br /><br />-&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <strong>Do you need UK residency to invest in London prime property?<br /></strong></li></ul><p data-list="0" data-level="1"><br />No, you don&rsquo;t need to be a UK resident to&nbsp;buy Prime properties in London, or anywhere else in the UK. Our experts can talk you through the buying process,
    tax implications, expected rental yields for buy to let investors, and much more.&nbsp;<a href="https://residential.jll.co.uk/#contactus">Get in touch</a>.</p><p data-list="0" data-level="1">Share your investment goals with us and our Prime Central London property experts can help match you to the right type, value and location of property for your needs.
</p><p>&nbsp;</p><hr /><p><sup>1</sup>&nbsp;<a href="https://www.showhouse.co.uk/news/foreign-buyers-make-up-over-40-of-londons-prime-property-market/">https://www.showhouse.co.uk/news/foreign-buyers-make-up-over-40-of-londons-prime-property-market/</a> <sup></sup></p><p><a data-sf-ec-immutable="">&nbsp;</a></p>

Guide to investing in Prime properties London, UK | JLL

An oversea buyer&rsquo;s guide to investing in Prime properties in London, UK

https://res.cloudinary.com/global-cms-assets-np/image/upload/v1664888534/resi/gb/Articles/Images/shutterstock_793935124.jpg

JLL Residential Research Report | August 2022

dpbrzqkve5qqphdvoicx

<h3>Are luxury properties in Prime Central London a good investment?
</h3><p>Property prices in Prime Central London (PCL) grew 8.1% in the year to February 2022<sup>1</sup>, compared to Hong Kong, where residential property prices declined by 2.9%, to their lowest since January 2021<sup>2</sup>. Hong Kong was also ranked as the
    least affordable housing market
    <sup>3</sup> by Demographia, which assesses house prices in relation to income across 92 major housing markets in eight world nations<sup>4</sup>.</p><p><strong>Prime Central London outperforms many major international markets</strong></p><p>While house price growth in the UK in the year to February 2022 was strongest in Wales - with growth of 14.2%, <a href="https://residential.jll.co.uk/insights/news/prime-central-london-q1-2022">London property prices</a> continued
    to increase at a strong rate (8.1%) and England&rsquo;s capital city still boasts unrivalled attractions across the six Prime Central London locations.</p><p>As well as boasting strong post-pandemic growth, Prime Central London real estate has proven to be a less volatile investment than Hong Kong&rsquo;s, for example, during
    periods of financial crisis. According to a recent article, quoting house price drops during the 2008 credit crunch, London property prices dropped 11%, compared to 50% in Hong Kong and 77% in Singapore<sup>5</sup>.</p><p><strong>PCL property prices are strong and growing compared to previous years</strong></p><p>Our quarterly research shows that residential property prices in Prime Central London were up 0.6% in Q1 2022, compared to Q4 2021, and achieving prices that are 4.7% more than in Q1 2020. Luxury London properties listed for between &pound;2milion and &pound;5million saw particularly strength growth, with sales up 25% year on year.</p><p>The figures speak for themselves, but what are the non-financial benefits of investing in London?</p><p><strong>The benefits of buying Prime Central London: A quick area overview</strong></p><p>When it comes to investing in luxury London property, are you looking to own and occupy or buy to let? Your investment intentions will inform the best area to buy in and the right type of property for you.</p><p>Here&rsquo;s a quick area overview of the six Prime Central London locations.</p><p><span style="text-decoration:underline;">Knightsbridge</span></p><p>Possibly the most iconic of the six Prime Central London locations, Knightsbridge is home to a selection of high-end townhouses, unique mews properties, and luxury flats, all within touching distance of the luxury, opulence, and history of landmarks like
    Harrods, the V&amp;A, and the London Oratory.</p><p><span style="text-decoration:underline;">Kensington &amp; Chelsea</span></p><p>A designer shopper&rsquo;s paradise, the London Borough of Kensington and Chelsea boasts stunning detached family homes and spacious terraces, all on the doorstep of the high-end boutiques and designer flagship stores lining the Kings Road and Sloane
    Square.
</p><p>Luxury dining at the Borough&rsquo;s Michelin-starred restaurants (Bibendum, Elystan Street, and Kitchen W8) means you&rsquo;re spoilt for choice when it comes to fine dining. Properties in this area are also walking distance to the Saatchi Gallery, Chelsea
    Physic Garden, and Chelsea Embankment Gardens. Luxury properties in Kensington and Chelsea offer a feeling of space, opulence, and community within Prime Central London.</p><p><span style="text-decoration:underline;">Mayfair</span></p><p>Featuring high ceilings and a true feeling of space, Mayfair&rsquo;s luxury flats often sit within stunning period properties that have been sympathetically converted to the highest specifications.</p><p>New build developments in Mayfair also put you close to some of London&rsquo;s most famous streets, sights, and shopping. From the designer flagship stores along Bond Street and the quintessentially British tailoring on Savile Row, to outdoor living at
    Hyde Park, and fine dining at Claridge&rsquo;s and Browns, owning a property in Mayfair will give you the very best of city London.</p><p><span style="text-decoration:underline;">Marylebone</span></p><p>London is a collection of distinctive areas, each one boasting a unique character. Marylebone has built up a real village-like feel right at the heart of the action. Its streets are lined with al-fresco dining spots and independent retailers, and with
    fascinating art on show at the Wallace Collection, a Marylebone property is one for food lovers, those in search of unique boutique spots, and art collectors alike.</p><p>The area is perfect if you&rsquo;re looking to invest in the best of London period property, updated to the very highest standards for modern living.</p><p><span style="text-decoration:underline;">Belgravia</span></p><p>Luxury flats and terraced houses on quiet squares, Belgravia&rsquo;s beautiful residential north to south streets connect Hyde Park to Chelsea Embankment, while its east to west properties join up Chelsea and Westminster.</p><p>Home to perhaps Peggy Porschen Cakes &ndash; perhaps the London food scene&rsquo;s most Instagrammable exterior, as well as to a whole host of other beautiful, independent boutiques and eateries, Belgravia feels typically London and is popular among working
    professionals with second properties outside of the capital.</p><p><span style="text-decoration:underline;">Westminster</span></p><p>Westminster is all about incredible views of iconic landmarks. Home to stunning penthouse apartments close to Westminster Abbey, the Houses of Parliament, Buckingham Palace, and St James&rsquo; Park, Westminster offers riverside views and London living
    at its best.</p><p>London is the home of luxury living with properties right at the heart of the action. Prime Central London offers the perfect mix of leafy green parks, river views, iconic landmarks, and opulent retail, dining, and cultural experiences, for the discerning
    buyer.
</p><p>Discuss your property portfolio objectives with our Prime Central London experts and we will uncover the right luxury property for you.<span style="text-decoration:underline;"> </span>&nbsp;</p><hr /><p><sup>1</sup>&nbsp;<a href="https://www.gov.uk/government/news/uk-house-price-index-for-february-2022">https://www.gov.uk/government/news/uk-house-price-index-for-february-2022</a> </p><p><sup>2</sup>&nbsp;<a href="https://www.reuters.com/world/asia-pacific/goldman-sachs-expects-hong-kong-home-prices-fall-20-by-end-2025-2022-03-30/">https://www.reuters.com/world/asia-pacific/goldman-sachs-expects-hong-kong-home-prices-fall-20-by-end-2025-2022-03-30/</a> </p><p><sup>3</sup>&nbsp;<a href="http://www.demographia.com/dhi.pdf">http://www.demographia.com/dhi.pdf</a></p><p><sup>4</sup>The study assesses house prices in relation to income in 92 major housing markets across eight nations &ndash; 1. Australia 2. Canada 3. China 4. Ireland 5. New Zealand 6. Singapore 7. The United Kingdom 8. The United States. <a href="http://www.demographia.com/dhi.pdf">http://www.demographia.com/dhi.pdf</a></p><sup>5</sup>&nbsp;
<a href="https://www.habitatinvestments.co.uk/prime-central-london-remains-one-of-the-best-global-real-estate-investments-it-is-claimed/">https://www.habitatinvestments.co.uk/prime-central-london-remains-one-of-the-best-global-real-estate-investments-it-is-claimed/</a>
<a data-sf-ec-immutable=""></a>

Investing in Prime properties London | JLL

Are luxury properties in Prime Central London a good investment?

https://res.cloudinary.com/global-cms-assets-np/image/upload/v1664884636/resi/gb/Articles/Images/shutterstock_1096649450.jpg

<p><strong style="background-color:transparent;color:inherit;font-size:inherit;text-align:inherit;text-transform:inherit;white-space:inherit;word-spacing:normal;caret-color:auto;">Restrictions lift but rising rates could temper demand amongst some potential buyers</strong><br
    /></p>
<p>The Bank of England continues to walk a challenging tightrope, one which some say it stepped onto too late. Global economies continue to struggle with rising inflation, a combination of demand returning following the lifting of covid restrictions alongside
    the implications on food and fuel costs following the war in Ukraine. The Bank of England alongside many global banks is responding by increasing rates in an attempt to counter inflation. &nbsp;</p>
<p>For borrowers, the first week of August provided mixed news. On the first the Bank scrapped the requirement for lenders to impose additional affordability tests on borrowers, announced back in June. But days later, the Bank followed this with further
    increases in the base rate. It has to be said this wasn&rsquo;t a complete surprise, as those in the market were preparing themselves for the prospect of further rises this summer.&nbsp;</p>
<p>On 4<sup>th</sup> August the Bank announced the first half point rise in 27 years.&nbsp; MPC members voted 8-1 in favour of increasing the base rate to 1.75%</p><img src="https://olmresi-my-prod.jll.com/images/default-source/agency/microsoftteams-image-(2).png?Status=Master&amp;sfvrsn=8b3f4186_1" sf-size="100" alt="" /><span style="background-color:transparent;color:inherit;font-family:inherit;font-size:inherit;text-align:inherit;text-transform:inherit;white-space:inherit;word-spacing:normal;caret-color:auto;"></span>
<p>Of course, in the longer term the intention of this rate rise is to curb inflation, but in the short-term households are facing significant increases in the cost of living driven by food and fuel alongside wage rises which in many cases are not keeping
    pace with household expenditure. &nbsp;</p>
<p>For mortgaged owner occupiers the proliferation of fixed rates loans will add some comfort. In Q1 2022 82% of outstanding mortgage debt was on fixed rates, up from less than a third a decade earlier. But for those looking to buy or re-mortgage recent
    rate rises will mean they pay more. Prior to the August interest rate rise the effective mortgage rate hit 2.15% at the end of June. Up from a low of 1.50% at the end of November 2021 and back to levels last seen in November 2016.&nbsp;</p>
<p>But there hasn&rsquo;t been a seismic shift for many borrowers coming out of longer-term fixed rates, who would not have benefited from the record low rates in 2021. Effective rates for those coming out of a five-year fix in June 2022 (2.15%) only marginally
    higher than in June 2017 (2.05%). Albeit those exiting fixed rates in the coming months will experience a wider gap following the 4<sup>th</sup> August announcement.</p><img src="https://olmresi-my-prod.jll.com/images/default-source/agency/microsoftteams-image-(1).png?Status=Master&amp;sfvrsn=d71d87ba_1" sf-size="100" alt="" />
<p><br /></p>
<p><strong></strong><br /></p>
<p><strong></strong><br /></p>
<p><strong>Lifting restrictions</strong></p>
<p>Earlier in the same week, on 1st August, the Bank removed the requirement for lenders to impose an affordability test, which required lenders to assess whether potential borrowers would be able to afford an interest rate hike equivalent to 3%. Which as
    interest rates rise would have meant much tighter affordability criteria for borrowers.</p>
<p>The Loan to Income (LTI) threshold, the more meaningful measure for most borrowers remains.&nbsp; With lenders limited on the number of loans they can issue at more than 4.5X income.&nbsp;</p>
<p><strong>What will this mean for the housing market?</strong></p>
<p>In recent months the UK housing market has continued to defy gravity. Significant increases in energy costs and rising inflation have been with us for some time now, yet house prices have so far appeared immune to rising costs elsewhere in the economy.&nbsp;
    The latest figures from the Nationwide Index show prices nationally rose 11% in June 2022, with regional growth of between 6.0% in London and 14.7% in South West. There are some signs that levels of demand are slowing, but few are reporting price
    falls and agents continue to see demand outstripping supply.</p>
<p>It would be na&iuml;ve to assume rising interest rates will not have some impact on the market. But in the short term it is possible that we will not see as significant an impact as one might expect.&nbsp;</p>
<p>Not all households are being impacted equally.&nbsp; Research by the Institute of Fiscal Studies suggested the poorest 10% of households experienced CPI inflation three percentage points higher than the richest 10%, due in part to these households spending
    a higher proportion of their income on energy and food. It is likely that those households where rising living costs bite the hardest are either renting their homes or are not in a position to move.&nbsp;</p>
<p>Indeed, this could mean we see prices rise further as more affluent households with a larger financial buffer, who usually buy more expensive properties, make up a higher proportion of transacting households.&nbsp;</p>
<p>Where we could see rising costs (living and debt financing) impact most significantly is on transaction volumes. But this too is far from certain, with some households potentially looking to purchase now, anticipating further rate rises or looking to
    take advantage of schemes like Help to Buy. It is also important to remember that 30% of purchases nationally were cash.</p>
<p><strong>Looking ahead</strong></p>
<p>Over the next six months we expect the sustained double-digit growth in prices we&rsquo;ve experienced so far in 2022 will recede as the market settles. But it is important to state that this is expected to be a slowing of growth not a fall in prices.&nbsp;</p>
<p>While some households will be deterred from moving due to higher rates, others will be keen to lock in at current (albeit higher) rates rather than risk further rate rises in the months to come.&nbsp; The ending of the government backed Help to Buy scheme
    in March 2023 also means that we could see a flurry of deals from first time buyers keen to take advantage of the scheme before it closes.&nbsp;</p>
<p>In the longer-term higher interest rates will of course be a barrier to some households. This combined with the end of Help to Buy will undoubtedly impact on first time buyer&rsquo;s ability to enter the market.&nbsp; With higher borrowing costs, rises
    in the cost of living and recent house price appreciation all acting as barriers.&nbsp; Conversely, we expect existing owner occupiers, particularly those buying with cash will increase as a proportion of sales.</p>
<p>Marcus Dixon &ndash; Director of Residential Research at JLL comments:</p>
<p><em>&ldquo;The UK is not alone in experiencing high rates of inflation, with the Bank of England reacting in the same way as many global banks in imposing multiple rate rises. For households this comes at a difficult time as the cost-of-living squeeze erodes households disposable incomes and adds a layer of uncertainty on future outgoings.&nbsp;</em></p>
<p><em>&ldquo;For the housing market the removal of the affordability stress test will add some wriggle room for purchasers and lenders alike, but we expect rate rises alongside and imbalance between wage rises and living costs will combine to deter activity amongst first time buyers and more financially exposed home movers.&rdquo;&nbsp;</em>
    <span style="background-color:transparent;color:inherit;font-family:inherit;font-size:inherit;text-align:inherit;text-transform:inherit;white-space:inherit;word-spacing:normal;caret-color:auto;"></span></p>
<p><strong>&nbsp;</strong></p>
<p><strong></strong><br /></p>
<p><strong></strong><br /></p>
<p><strong></strong><br /></p>
<p><strong></strong><br /></p>
<p><strong></strong><br /></p>
<p><strong></strong><br /></p>
<p><strong>About JLL | August 2022</strong></p>
<p>JLL is a leading global professional services firm specialising in real estate and investment management, with $16.6bn annual revenue in 2020, operations in over 80 countries and a global workforce of over 90,000.&nbsp; With over 7,000 employees and 15
    offices in the UK, we support our investor, developer and occupier clients at every stage of the property lifecycle across both commercial and residential asset classes. This includes land purchase, access to capital, planning, development advisory,
    leasing, building management and sales.&nbsp;</p>
<p>JLL&rsquo;s Residential and Living team consists of over 300 professionals who provide a comprehensive end-to-end service across all residential property types, including social housing, private residential, build to rent, co-living, later living, healthcare
    and student housing.&nbsp;</p>
<p><br /></p>
<p>Disclaimer: &copy; 2022 Jones Lang LaSalle IP, Inc. All rights reserved.</p>
<p>Data within this report is based on material/sources that are deemed to be reliable and has not been independently verified by JLL. JLL makes no representations or warranties as to the accuracy, completeness or suitability of the whole or any part of
    the report which has been produced solely as a general guide and does not constitute advice. No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of JLL. JLL, its officers, employees
    shall not be liable for any loss, liability, damage or expense arising directly or indirectly from any use or disclosure of or reliance on such report. JLL reserves the right to pursue criminal and civil action for any unauthorized use, distribution
    or breach of such intellectual property.</p>

JLL – Interest rates, mortgages, and the impact on house prices

https://res.cloudinary.com/jll-global-olm-np/image/upload/v1659626579/resi/gb/cms/Research/Images/Architecture_wide-angle_059.jpg

<p><strong>JLL&rsquo;s latest Living Priorities Survey.</strong></p>
<p>What we want from our homes is constantly evolving. Both the pandemic and rising energy costs means households are again re-evaluating their priorities. </p>
<p>To better understand what buyers want in today&rsquo;s market, and how this might change in the future, we contacted potential buyers registered with JLL to hear their thoughts. </p>
<p><strong style="background-color:transparent;color:inherit;font-size:inherit;text-align:inherit;text-transform:inherit;white-space:inherit;word-spacing:normal;caret-color:auto;">Electric cars &ndash; a lesson for the housing market?</strong><br /></p>
<p><span style="background-color:transparent;color:inherit;font-family:inherit;font-size:inherit;text-align:inherit;text-transform:inherit;white-space:inherit;word-spacing:normal;caret-color:auto;">Within a short space of time, we have seen a rapid shift in motorists&rsquo; willingness to adopt electric vehicles in a bid to lower their environmental impact. Could we see this positive approach to environmental sustainability feed through into our homes?</span><br
    /></p><img src="https://olmresi-my-prod.jll.com/images/default-source/agency/graphical-image-1-insights.png?Status=Master&amp;sfvrsn=47d153a5_1" sf-size="100" alt="" />
<p>New JLL research from our latest Living Priorities survey, explores the change in the proportion of people who expect to be driving an electric or hybrid vehicle in the future. At present, just 8% of respondents drive an electric or hybrid car, versus
    43% petrol or diesel. However, when asked about their next vehicle the survey results show a greater appetite for electric vehicles, with almost 70% expecting to drive an electric or hybrid car in the future, versus just 9% for petrol or diesel.</p>
<p><strong>What&rsquo;s driving the push towards more energy efficiency homes?</strong></p>
<p>For most, our homes will be the largest investment we make in our lives. Our survey has found that a larger number of people are now placing even more importance on the environmental impact of their home. Undeniably, reducing the running costs of a home
    is the key motivator for most, however many people are also increasingly aware that there is a desire to become more socially responsible. Almost two thirds of our respondents said that achieving a lower carbon footprint was important to them.</p><img src="https://olmresi-my-prod.jll.com/images/default-source/agency/grpahical-image-2-insights.png?Status=Master&amp;sfvrsn=36e05bc6_1" sf-size="100" alt="" />
<p>70% of respondents viewed the energy efficiency and running costs of their home as more important now versus pre-pandemic. Back in April, we explored <a href="https://residential.jll.co.uk/insights/news/jll-could-new-home-demand-rise-as-energy-prices-soar"></a>
    <a href="https://residential.jll.co.uk/insights/news/jll-could-new-home-demand-rise-as-energy-prices-soar">what the rising energy costs meant for UK homes</a>. JLL research found that the lifting of the energy price cap could result in the average band G home experiencing an increase in bills of over &pound;1,700 per annum, an extra &pound;3,246 more per
        annum than the average home in bands A-C. It is therefore unsurprising perhaps, that 82% of respondents voted a &lsquo;saving on energy bills&rsquo; as the reason why the environmental sustainability of their home is important to them.</p>
<p><strong>Are purchasers willing to pay more?</strong></p>
<p>Over half of respondents (57%) would be prepared to pay a premium for a more environmentally friendly home. Of those who said &lsquo;yes&rsquo;, half would pay just up to 5%. In total, 83% of those who would pay a premium, would be prepared to pay up
    to 10% more for an environmentally friendly home.&nbsp;</p><img src="https://olmresi-my-prod.jll.com/images/default-source/agency/grpahical-image-3-insights.png?Status=Master&amp;sfvrsn=fc72dafe_1" sf-size="100" alt="" />
<p><strong>So, what does this mean for our homes in the future, particularly the new homes sector?</strong></p>
<p>Rising energy costs have undoubtedly pushed energy efficiency up the list of importance for homeowners. But whether they are driven purely by costs, social responsibility or likely a combination of both, what is clear is that buyers will be taking energy
    consumption into consideration more, when looking for homes in the future. </p>
<p>80% of our respondents said that the environmental impact of their home will be either crucial or important in their next move, with the number of people willing to purchase a new home, if it meant improved environmental efficiency, rising from 51% from
    their last move, to 78% going forward. </p>
<p>With purchasers becoming more environmentally aware and the potential for more sustainable homes to command a premium, the new homes market should be well placed to benefit.&nbsp; Analysis of EPC ratings for UK homes shows 83% of new build properties
    boast an EPC rating of A or B, versus just 3% for existing stock.</p>
<p><em style="background-color:initial;font-family:inherit;font-size:inherit;text-align:inherit;text-transform:inherit;white-space:inherit;word-spacing:normal;caret-color:auto;">The JLL Living Priority Survey 2022 was conducted in May 2022 with a total of 104 respondents.</em><br
    /></p>
<p><sup>Disclaimer: &copy; 2022 Jones Lang LaSalle IP, Inc. All rights reserved.</sup></p><sup>Data within this report is based on material/sources that are deemed to be reliable and has not been independently verified by JLL. JLL makes no representations or warranties as to the accuracy, completeness or suitability of the whole or any part of the report which has been produced solely as a general guide and does not constitute advice. No part of this publication may be reproduced or transmitted in any form or by any means without prior written consent of JLL. JLL, its officers, employees shall not be liable for any loss, liability, damage or expense arising directly or indirectly from any use or disclosure of or reliance on such report. JLL reserves the right to pursue criminal and civil action for any unauthorized use, distribution or breach of such intellectual property.</sup>
<p>&nbsp;</p>

Are buyers waking up to the benefits of a more environmentally friendly home?

A first glance at JLL&rsquo;s latest Living Priorities Survey

https://res.cloudinary.com/jll-global-olm-np/image/upload/v1655188461/resi/gb/cms/News/Images/GettyImages-735934791-488x144.jpg

UK Residential Forecast 2022 – 2026

btcfa2vlso31cg2l1sjx

Site Settings

Landlord - block

MY Contacts

title="Price"
metric="£"
type="minmax"
name="Price"
order=1

[min]
[min.0]
label="No Min"
value=""
[min.1]
label="£100,000"
value=100000
[min.2]
label="£200,000"
value=200000
[min.3]
label="£300,000"
value=300000
[min.4]
label="£400,000"
value=400000
[min.5]
label="£500,000"
value=500000
[min.6]
label="£600,000"
value=600000
[min.7]
label="£700,000"
value=700000
[min.8]
label="£800,000"
value=800000
[min.9]
label="£900,000"
value=900000
[min.10]
label="£1,000,000"
value=1000000
[min.11]
label="£2,000,000"
value=2000000
[min.12]
label="£3,000,000"
value=3000000
[min.13]
label="£4,000,000"
value=4000000
[min.14]
label="£5,000,000+"
value=5000000

[max]
[max.0]
label="No Max"
value=""
[max.1]
label="£100,000"
value=100000
[max.2]
label="£200,000"
value=200000
[max.3]
label="£300,000"
value=300000
[max.4]
label="£400,000"
value=400000
[max.5]
label="£500,000"
value=500000
[max.6]
label="£600,000"
value=600000
[max.7]
label="£700,000"
value=700000
[max.8]
label="£800,000"
value=800000
[max.9]
label="£900,000"
value=900000
[max.10]
label="£1,000,000"
value=1000000
[max.11]
label="£2,000,000"
value=2000000
[max.12]
label="£3,000,000"
value=3000000
[max.13]
label="£4,000,000"
value=4000000
[max.14]
label="£5,000,000+"
value=1000000000

Sale - Price

Price

title="Price"
metric="£"
type="minmax"
name="Price"
order=1

[min]
[min.0]
label="£0"
value=0
[min.1]
label="£1,000 pcm"
value=1000
[min.2]
label="£2,000 pcm"
value=2000
[min.3]
label="£3,000 pcm"
value=3000
[min.4]
label="£4,000 pcm"
value=4000
[min.5]
label="£5,000 pcm"
value=5000
[min.6]
label="£6,000 pcm"
value=6000
[min.7]
label="£7,000 pcm"
value=7000
[min.8]
label="£8,000 pcm"
value=8000
[min.9]
label="£9,000 pcm"
value=9000
[min.10]
label="£10,000+ pcm"
value=10000
 
[max]
[max.0]
label="£0"
value=0
[max.1]
label="£1,000 pcm"
value=1000
[max.2]
label="£2,000 pcm"
value=2000
[max.3]
label="£3,000 pcm"
value=3000
[max.4]
label="£4,000 pcm"
value=4000
[max.5]
label="£5,000 pcm"
value=5000
[max.6]
label="£6,000 pcm"
value=6000
[max.7]
label="£7,000 pcm"
value=7000
[max.8]
label="£8,000 pcm"
value=8000
[max.9]
label="£9,000 pcm"
value=9000
[max.10]
label="£10,000+ pcm"
value=1000000

Rent - Price

title="Bedrooms"
metric="bedrooms"
type="minmax"
name="bed"
order=2

[min]
[min.0]
label="No Min"
value=""
[min.1]
label="Studio"
value=0
[min.2]
label="1 bedroom"
value=1
[min.3]
label="2 bedrooms"
value=2
[min.4]
label="3 bedrooms"
value=3
[min.5]
label="4 bedrooms"
value=4
[min.6]
label="5 bedrooms"
value=5
[min.7]
label="6 bedrooms"
value=6
[min.8]
label="7 bedrooms"
value=7
[min.9]
label="8+ bedrooms"
value=8

[max]
[max.0]
label="No Max"
value=""
[max.1]
label="Studio"
value=0
[max.2]
label="1 bedroom"
value=1
[max.3]
label="2 bedrooms"
value=2
[max.4]
label="3 bedrooms"
value=3
[max.5]
label="4 bedrooms"
value=4
[max.6]
label="5 bedrooms"
value=5
[max.7]
label="6 bedrooms"
value=6
[max.8]
label="7 bedrooms"
value=7
[max.200]
label="8+ bedrooms"
value=200

Bedrooms

title="Property Type"
metric="propertyType"
type="select"
name="type"
placeholder="Any Type"
order=3

[[options]]
label="Any Type"
value=""
[[options]]
label="Flats"
value="flats"
[[options]]
label="Houses"
value="houses"

Property Type

type

title="Country"
type="checkboxes"
name="flags"
order=4

[[options]]
label="United Kingdom"
value="United Kingdom"
[[options]]
label="Japan"
value="Japan"
[[options]]
label="UAE / Dubai"
value="United Arab Emirates"
[[options]]
label="Australia"
value="Australia"

Sale - Options

flags

Country

title="Options"
type="checkboxes"
name="flags"
order=4

[[options]]
label="Short Term"
value="short-term"
[[options]]
label="Furnished"
value="furnished"
[[options]]
label="Unfurnished"
value="unfurnished"

Rent - Options

Options

Malaysia

Singapore

Hong Kong

China

Property Enquiry

<p><strong>PRIVACY NOTICE</strong></p>
<p>Jones Lang LaSalle (JLL), together with its subsidiaries and affiliates, is a leading global provider of real estate and investment management services. We take our responsibility to protect the personal information provided to us seriously.</p>
<p>Generally the personal information we collect from you are for the purposes of dealing with your enquiry.</p>
<p>We endeavor to keep your personal information secure with appropriate level of security and keep for as long as we need it for legitimate business or legal reasons. We will then delete it safely and securely. For more information about how JLL processes
    your personal data, please view our <a href="https://www.jll.co.uk/en/privacy-statement" target="_blank">privacy statement</a>.</p>

Arrange View

anythingElse

date

email

firstName

generalEnquiry

intlDialCode

lastName

marketingOptin

submit

telephone

time

userAction

videoOption

Let us know your preferred time for a viewing and we will get in touch with you to confirm a time.

Fill out the form or call us at {{ phone }}

Arrange a viewing

<p>PRIVACY NOTICE</p><p>Jones Lang LaSalle (JLL), together with its subsidiaries and affiliates, is a leading global provider of real estate and investment management services. We take our responsibility to protect the personal information provided to us seriously.</p><p>Generally the personal information we collect from you are for the purposes of dealing with your enquiry.</p><p>We endeavor to keep your personal information secure with appropriate level of security and keep for as long as we need it for legitimate business or legal reasons. We will then delete it safely and securely. For more information about how JLL processes your personal data, please view our&nbsp;<a href="https://www.jll.co.uk/en/privacy-statement" target="_blank">privacy statement</a>.</p>

General Enquiry

<p><strong></strong></p><p><strong>PRIVACY NOTICE</strong></p><p>Jones Lang LaSalle (JLL), together with its subsidiaries and affiliates, is a leading global provider of real estate and investment management services. We take our responsibility to protect the personal information provided to us seriously.</p><p>Generally the personal information we collect from you are for the purposes of dealing with your enquiry.</p><p>We endeavor to keep your personal information secure with appropriate level of security and keep for as long as we need it for legitimate business or legal reasons. We will then delete it safely and securely. For more information about how JLL processes your personal data, please view our&nbsp;<a href="https://www.jll.co.uk/en/privacy-statement" target="_blank">privacy statement</a>.</p><p>&nbsp;</p>

Gated Content Form

Valuation

<p><strong>PRIVACY NOTICE</strong></p><p>Jones Lang LaSalle (JLL), together with its subsidiaries and affiliates, is a leading global provider of real estate and investment management services. We take our responsibility to protect the personal information provided to us seriously.</p><p>Generally the personal information we collect from you are for the purposes of dealing with your enquiry.</p><p>We endeavor to keep your personal information secure with appropriate level of security and keep for as long as we need it for legitimate business or legal reasons. We will then delete it safely and securely. For more information about how JLL processes your personal data, please view our&nbsp;<a href="https://www.jll.co.uk/en/privacy-statement" target="_blank">privacy statement</a>.</p>

Trends and Insights

Insights