The agent said that London’s population is estimated to grow by 920,000 people between 2014 and 2024 and this will require the creation of 570,000 new homes. Yet London is able to provide enough extra homes by redeveloping just 1.3% of the capital’s land area on average, while preserving all green space.
Andrew Bridges, managing director of Stirling Ackroyd, said: “London can build the extra space required to house its own rapid success.
“To keep up with a growing population these opportunities are likely to become reality over the next 10 years. Even a cautious projection puts the capital’s population at nine million before 2020, and half a decade before that landmark the city already needs more homes. Yet this level of development is not impossible or even unlikely. It’s already starting.”
Stirling Ackroyd has identified 10 wards that will be new homes hotspots in the capital: Chaucer and Riverside in Southwark; Shadwell, Bromley-by-Bow, Limehouse, St Katherine’s & Wapping, and Spitalfields and Banglatown, all in Tower Hamlets; Bunhill in Islington; Hoxton in Hackney; and St Pancras and Somers Town in Camden.
“New homes hotspots are constantly evolving, and it is likely that in time developers will move from the top 10 areas identified here to the top 20 – and beyond,” said Bridges, “Bigger trends are also clear. London’s heart and soul is gradually shifting eastwards – not as any other location declines but as the entire city grows in the direction of maximum opportunity.
Ackroyd said the City fringes were generating jobs, and these areas have grown ripe with opportunity for London’s new homes industry.
“Regeneration is vital for London to maintain its growth and status as a world city – while also bringing new status, new wealth and new opportunities to neighbourhoods that were previously only observers in London’s spectacular show of economic growth,” he added.
At 2014 prices, (i.e. even before any increase in London house prices) new homes could add a total of £198bn to London’s gross property wealth, or an extra 13% to the £1.51trn total as of mid-2014.
While the value of future homes will vary by location, this would equate to an average £350,000 sale price for these new properties at current market rates.