New house price data released on Friday seemed to suggest that sanity was returning to the market – but there was little sign of that at one London development, where a studio flat in Battersea power station that sold for close to £1m in the spring is about to go back on the market with a price tag of up to £1.5m. And it has not even been built yet.
The flat is one of 254 luxury apartments that were launched off-plan in May at a lavish marquee party where prospective buyers were serenaded by Elton John. Prices for studios started from £800,000, while one-bed flats cost £1m or more and four-bed homes carried price tags of £4m or more. Construction has not yet started and they are due to be completed in late 2018.
Henry Wiltshire, an upmarket estate agent that is setting up an office in nearby Vauxhall, is close to being appointed to handle the resale of the studio apartment on the fifth floor of the power station. Kyle Spence, the firm’s sales director, said the vendor was “someone we met at Cityscape [a property conference] in Dubai,” who hopes to resell the apartment for between £1.4m and £1.5m.
Homes in the former power station, a Grade II* listed 1930s brick colossus whose four white chimneys are instantly recognisable on the south London skyline, will have access to more than 1.5 acres of rooftop private garden.
The apartments have polished concrete floors and worktops, raw brass fittings, copper bathtubs and other industrial features, and will be about 40% larger than the average new-build home in London, the developers claim.
Chris Innes-Ker, associate at John D Wood & Co, one of the largest estate agents in Battersea, said the new price was credible. “It’s an entirely separate market from what’s going on in the real world,” he said. “It seems to be defying all logic. It’s creating a market of its own.”
The Malaysian consortium that is turning the 42-acre site into a huge complex of apartments, shops and offices in an £8bn project has sold more than 1,300 homes so far in three rounds. The first two phases all but sold out before a single brick was laid. Only 560 (16%) of the planned total of 3,444 new homes will be affordable housing.
In the wider market, figures published on Friday by the Land Registry suggested the frenzy that characterised the first half of the year in the capital had eased. Its data for sales registered in October, which does not include new-build homes, showed growth of 0.7% during the month in London – but it found rises of 1.2% and 1.6% respectively in the south-east and east of England.
October’s growth in London reversed a fall of the same magnitude in September, but is a far cry from the 2.7% rise recorded in August. Annual price growth in the capital has also dropped off since the summer, to stand at 18.6% in October, with the average price of a property at £460,060. The figures for Wandsworth, the London borough that is home to the power station, showed a 0.6% month on month price rise and annual growth of just under 23%. Across England and Wales, the Land Registry said prices were up by just 0.1% over the month and by 7.7% since October 2014, standing at an average of £177,377.
Separate figures from the UK’s biggest building society showed growth slowing as the market moved into the winter. Nationwide said the price of a typical home had risen by 0.9% over the three months to the end of November, the lowest quarterly rate since May last year. The annual rate of growth also fell, to 8.5%. The society, which bases its figures on mortgages it has agreed during the month, put the average cost of a UK home at £189,388.
Nationwide’s chief economist, Robert Gardner, said that there was “something of a disconnect” between the slowdown in the housing market and wider economic indicators. “Forward looking indicators, such as new-buyer inquiries, point to further softness in the near-term. However, if the economy and the labour market remain in good shape and mortgage rates do not rise sharply, activity is likely to pick up in the quarters ahead.”