Lasting Appeal

16 May 2016, by Kirsty Bennison

Richmond is well placed to attract a wide range of buyers and tenants in the future

 

It is important to assess the outlook for Richmond in the context of the wider prime London market.

The sales market

The Autumn Statement in 2014 marked a turning point for the prime London housing market. As a result of increases in stamp duty rates for higher value properties, coupled with increased mortgage regulation which limits the amount people can borrow against their earnings, the prime London housing market has seen price growth slow significantly.

Over the short term, the EU referendum in June is expected to result in values in prime London remaining broadly flat through 2016 and most of 2017, as the market continues to adjust to the new political and regulatory backdrop.

However, over the medium term we expect a gradual return to trend rates of price growth. Richmond will continue to appeal to a wide range of buyers, whether locating from within the borough, from central London or overseas.

The rental market

The London economy is forecast to continue strengthening, which will underpin demand for prime rental property over the medium term as more people move to London for employment opportunities.

Richmond is well placed to draw on this demand as a large proportion of tenants currently move to the area for this reason.

In Richmond, we do not expect a high level of new build stock to come forward compared to other locations in London. This means that supply will remain relatively constrained and rents will therefore not be suppressed by a high number of properties being brought to the market simultaneously.

As such, we are forecasting steady rental growth of 13.1% across prime London over the next five years.

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