The City and City Fringe - a housing market overview
Once considered only a place of work, the City is now more diverse and a desirable residential location; almost 1,000 new homes have been completed since 2009 and there are a further 740 currently under construction. The ability to live close to work is being realised as the quality of residential offering now matches the aspiration of City workers. As a result, the City is becoming a firm part of London’s prime residential property market and in the last five years average prices have increased by 81%, or 12.6% per year.
In tandem with the City’s rise in popularity, has been that of its fringe neighbourhoods, with an increasing number of people establishing themselves in areas such as Clerkenwell and Shoreditch, as well as the rejuvenated Wapping. The result is that the housing markets of these neighbourhoods have experienced significant growth, averaging 47% over the last five years, or 8.0% per year.
An influx of new residents to both the City and its fringe has also resulted in substantial growth in the number of people living in their respective private rented sectors. The number of households in the City’s private rented sector increased by 50% in the decade between 2001 and 2011 resulting in strong value growth; since 2005 asking rents in the City have increased by 6.2% per year on average, compared with 4.9% for London overall.
In the neighbourhoods bordering the City the private rented sector has increased by an even greater extent. Between 2001 and 2011, the number of privately rented households across these neighbourhoods increased by 120%, equating to an additional 5,250 households in the sector. This again has resulted in robust rental growth, averaging 4.3% per annum over the last five years.
London’s eastward migration has been in motion since the 1980s and is set to continue, with the emergence of the tech industry bringing a new wave of residents to the City and its fringe. This, combined with the continued growth of the City, means that in the future there will be persistently high demand for a homes in both the City and its bordering neighbourhoods.