London flat prices?

[SchoolOfKnocks]

Cash buyer here - wanting to buy a one bedroom flat in Zone 2, ideally with balcony.

Is it a falling market? Prices seem to have dropped but I'm thinking they may continue to fall. I'm in no rush.

Obviously NO ONE can predict these things and anything could happen! But I was wondering whether anyone has any feeling one way or the other about this....

Plan to keep it indefinitely, it wouldn't be an investment place that I would want to sell in a few years. So really it doesn't matter too much - but on the other hand I would like to buy the best place possible for my money!

Just as it's possible prices might continue to fall, it's equally likely they will start to rise again. Particularly in Spring, and with investors looking to snap up a bargain.

I don't agree with a pp that's there's more downsides to buying right now. It largely depends on your circumstances. If you're buying to have a home to live in and it's a flat you like, in an area you want to live, and you can afford it, it's worth going for it. It's likely better security than rent especially private rent. Remember too that the monthly mortgage will eventually reduce. Rents will only ever go up.

I'm not renting at the moment.

Ah ok. I'd say it's still worth going ahead now - if you're buying as a home to live in (as opposed to looking for a potential money-making investment).

If you find a flat you like, in an area you want to live in, at a price you can afford, you might as well just do it.

I'd say there's a fair chance that come spring prices will go up - with investors (including those happy to leave a place empty) looking for a bargain.

Somebody on this forum made a point that there was greater demand for outside space during lockdown because this coincided with spring/summer etc, and I thought that was a good point. How much demand is there for outside space in colder months?

I'm in a 1 bed flat without outside space in London. The last two days have been cold/wet and I've been reluctant to go outside, so haven't. It's been fine. Yes, lockdown results in cabin fever, but you can go out for a walk. Many of us have green spaces and large parks on our doorsteps (I have 3 no less) so whilst a balcony for those who smoke etc is ideal, I do feel that a heatwave amplifies the need for this disproportionately.

My point is basically that I reckon this is the low for London. News of a vaccine will be enough to kickstart prices - and given they’ve just vaccinated a big percentage of the population for flu, I think the covid vaccination roll out will be v fast.

Are you looking for a London bolthole, then?

I’m not sure about W14 but prices in prime and central areas have been falling down for a while.

If I were you, I’d probably keep an eye out for a good property and a motivated seller.

Yes, looking for a bolt hole! I only need one bedroom so I guess they are more likely to be up for sale? I like W14 but north London is good for me too.

Hi OP, we have a one bed zone 2 with garden that we've owned for a decade now. It's in the middle of a Victorian terrace and backs on to the rear of the gardens of the next terrace along so HUGELY secure - don't actually know of any burglaries on our road during the time we've owned it. So don't discount gardens - they can be a really good asset! :)

We moved out to the country last year due to the arrival of our first kid and retained the flat, moved onto a BTL mortgage. It's been very sought-after all of this year and I do think the garden has contributed to that, TBH.

I'm sure that Brexit and ongoing Covid mess will impact on prices - this article from The Guardian is certainly spelling doom for London flats! www.theguardian.com/business/2020/oct/03/green-and-pleasant-beats-urban-buzz-as-families-opt-to-leave-cities
But personally, in terms of our renters, we've found that enough people are in the market for a nice, safe, spacious property near to good tube lines and amenities, that (for now at least) we're staying positive.

Best of luck!

The guardian article refers to families.
I expect the market will pick up again for one and two beds. Lots of young singles and childless couples will still seek the buzz. Plenty of older empty nesters too.

What’s your budget?

It doesn’t seem to make much sense to pay a premium for outside space in a bolt hole. Flats without outside space aren’t very popular at the moment so there could be a bargain to be had.

I can understand the security concerns with a ground floor flat - anyone who likes their bedroom windows open at night would presumably prefer a non ground floor bedroom.
But a flat with a garden doesn’t have to be on the ground floor. In SW17, where we have one, and I dare say other areas, there are a lot of purpose built Edwardian maisonettes with their own small gardens. The first floor flat (almost always one of just two) will typically have steps from the kitchen down to a private outdoor space.

The added advantage of this type of property is that ground rent is typically low and service/maintenance charges minimal.
They are usually 2 bed flats, though.,

Budget is around £450k.

Yes I feel more secure upstairs. In our house we have the alarm on downstairs at night.

I wanted a small balcony even before Covid so it's not necessarily lockdown related for me - but it's a good point that somewhere without outside access (no matter how small) will now be less desirable so perhaps that's the way forward.

I agree with @Cavagirl that prices are likely to fall further next year with the furlough scheme ending at the end of this month and the effects of the recession not having been felt, stamp duty holiday ending plus Brexit too.
I don't think that a vaccine is at all likely to be rolled out in 6 months time so don't think house prices are likely to bounce any time soon.

My friend in Islington was told by the estate agent that their flat had lost rental value because of having no outdoor place - by a couple of hundred pounds a month actually - so presumably it'd be the same if selling. There seems to be quite a stampede of people leaving the capital.

I think that some flats will hold prices better than others. DDs is a warehouse conversion. It’s a short walk to the Underground. The flats have a shared garden. It’s not big but it’s quiet and pleasant. There’s a supermarket 5 mins walk away. There’s a big park 5 mins walk away. There’s a beautiful square with a pub a nano second away where neighbours play boule. I don’t think this area will greatly fall in price. It’s one stop into zone 2. Clapham is further along and is always popular! There’s zone 2 - and there’s zone 2. Not all areas are the same. I also think flats with gardens are now more popular. Having your own bit of space is desirable. Ground floor used to be cheaper! Balconies on older buildings are virtually impossible to find.

@Guymere your DD flat sounds lovely!

Yes it's impossible to call what will happen but just very interesting and helpful to read all these comments so thank you everyone! Truth be known it WOULD suit me (just logistically speaking) to hold off for a few months.

In my view, London is always going to come back at some stage - even if it's in 20 years time. In which case my DCs will have access to a London base at a future time when possibly they would otherwise have been priced out.

By the way, posters mention Brexit being a factor in potential London house price drops. How is this actually a factor? Is it because foreign businesses may leave London so their employees won't need housing any more? I can't see the type of place I am going for is likely to be the London bolthole of someone who works in a European bank for example!

You would be surprised! There may well be large international companies who decide to move their HQ from London. Not all these people are highly paid and not all will relocate abroad but some will. There’s a widespread belief that many firms will shrink their presence in London and will have more offices in the EU financial hubs. Any exodus of staff trickles down to the housing market.

I do think there'll be an exodus - not just of the employees of firms relocating to Europe, but also of the many MANY non-UK residents of London who have straightforward options of alternative places to live. One of the things that's always been great and 'buzzy' about London is that it's so diverse and multi-cultural. I know a few people personally who are likely to leave because they think they'll have better lives elsewhere now.

As well as an exodus, I also think Brexit is likely to compound with the Covid recession (the global economic impact of Spanish flu lasted well over a decade) and make a lot of businesses go bust, because of increased logistics and costs once we're out of the single market. Again, London attracts a lot of non-Londoners because it has good jobs and good opportunities compared to other cities. That may well not be true after Brexit - or at least the cons (cost) could likely begin to outweigh the pros.

I hope I'm proved wrong, obviously! But for us things were notably worse when we left in 2019 in terms of poverty and homelessness (stepping over sleeping bags on Piccadilly) than they were before the Tories' austerity madness... So I find it hard to feel optimistic!

If you want to stay in W14 checking on Rightmove in West Kensington there are flats with outside space (not gardens) in your price range. Having lived in the same area for many years I can understand why it's your preference! Just a selection here:
www.rightmove.co.uk/property-for-sale/property-95305139.html £400K
www.rightmove.co.uk/property-for-sale/property-83089237.html £425K
www.rightmove.co.uk/property-for-sale/property-85317658.html £430K
www.rightmove.co.uk/property-for-sale/property-94197308.html £450K

@sunshinesupermum

If you want to stay in W14 checking on Rightmove in West Kensington there are flats with outside space (not gardens) in your price range. Having lived in the same area for many years I can understand why it's your preference! Just a selection here: www.rightmove.co.uk/property-for-sale/property-95305139.html £400K www.rightmove.co.uk/property-for-sale/property-83089237.html £425K www.rightmove.co.uk/property-for-sale/property-85317658.html £430K www.rightmove.co.uk/property-for-sale/property-94197308.html £450K

Is the amount of internal space a factor at all?

All of the places in the links above are tiny!!! Fair enough if you're happy to pay that much to live in a shoebox, but you could deffo get so much more for your money if you looked outside of that particular borough

@WoolyMammoth55

I do think there'll be an exodus - not just of the employees of firms relocating to Europe, but also of the many MANY non-UK residents of London who have straightforward options of alternative places to live. One of the things that's always been great and 'buzzy' about London is that it's so diverse and multi-cultural. I know a few people personally who are likely to leave because they think they'll have better lives elsewhere now.

As well as an exodus, I also think Brexit is likely to compound with the Covid recession (the global economic impact of Spanish flu lasted well over a decade) and make a lot of businesses go bust, because of increased logistics and costs once we're out of the single market. Again, London attracts a lot of non-Londoners because it has good jobs and good opportunities compared to other cities. That may well not be true after Brexit - or at least the cons (cost) could likely begin to outweigh the pros.

I hope I'm proved wrong, obviously! But for us things were notably worse when we left in 2019 in terms of poverty and homelessness (stepping over sleeping bags on Piccadilly) than they were before the Tories' austerity madness... So I find it hard to feel optimistic!

If you're right and there's a massive exodus, do you think perhaps that might help ease the homelessness you noticed?

I think as a (rare) UK buyer who is a cash buyer for this kind of amount, you could easily find a 2-bed in w14 or a nice part of N.London, if you wait a couple of months. People just don't want to spend this much on a 1-bed flat as already te market is flooded - unless it comes with a proper garden or a garage or a great high spec / extra security.
Wealthy foreign buyers like to go for new-build or contem with gym / security.
Investors would rather go for a doer-upper or somewhere bigger to rent out to more people.

If you are not bothered to be in the very top areas, but just nice ones like W14 / parts of Highgate/Tuffnell Park, I think you really can pick and choose, as you wouldn;t need a mortgage approval, not bothered about ESW issues, and some people don't want to sell to investors / there are restrictions on rentals in some building.

You can also have a real bargain if you go for a shorter lease as again - they can't sell to mortgage buyers yet you could invest in lease extention if you get smth under your budget. It will work out cheaper and although it takes a while, you aer in no rush (but make sure you know who freeholder is as some live abroad/company and unresponsive).

*contemporary