Weekly Property Round Up
In the aftermath of the election, many expect substantial regulatory and fiscal changes to affect the property industry. As ever, we will attempt to keep you up to date on the big headlines in the property market each week. Here are some of the stories that have captured our attention.
London's West End – World's Most Expensive Office Space
Research from DTZ has shown that London's West End is the world's most expensive office space, with the cost per workstation increasing 10% in the year to £18,700. Of the 132 cities surveyed many have seen a fall in cost per workspace, including New York, Moscow and Sydney. Remarkably, the cost of office space in central London is now 11 times more expensive than that of Lisbon, Europe's cheapest.
Labour's Mansion Tax Rethink
As the candidates vie for Labour's new leadership, most have distanced themselves from Milliband's levy on expensive homes. In attempts to appear more centralist, it is widely assumed the tax will get the axe under whoever wins the leadership contest.
Commercial Property Lending Hits Post-Crash High
Research into the UK's commercial property lending market has shown loans have soared to £45.2bn at year end 2014, compared with £29.9bn in 2013. 'New lending', mainly from insurance companies and other non-bank lenders, have increased over 50% in the past year – a result of regulatory changes and the withdrawal of banks from the sector. As property values have increased, the attractiveness of lending has risen; and as a result, the market has seen a increase in the proportion of debt being adopted on properties where loan-to-value ratios have been historically low.
Land Securities Double Profits
The UK's largest commercial property company have doubled its pre-tax profits to £2.4bn. The company's booming London office market saw a 25% rise in basic net asset value per share, and Land Securities chief executive, Rob Noel, highlighted the performance being a direct result of a chronic shortage of office supply in London. The incredible rise in profits have derived from Land Securities' five-year plan to invest in areas of the capital where there have been a clear shortage of office stock. Mr Noel believes the supply gap in office space will continue, and as a result, rents in the West End and the City will continue to rise in the coming years.
And Finally… Summers Coming – Beach Huts for Sale at £200,000
Despite having no water, toilets or mains electricity, and only being 15ft by 10ft, eight beach huts are on the market for a combined £1.6million. Located on the sandbank in Mudeford, Dorset, the huts offer isolation and perfect access to the beach for those wanting to make the most of the British summer. Currently one has been sold, subject to contract for £240,000.